The United States and China have reached a framework of a deal that might free TikTok to continue to operate in the United States, comments from Treasury Secretary Scott Bessent suggested, according to remarks retransmitted by CNBC.
He described the agreement as an understanding “between two private parties,” contending that commercial terms have been settled. The move comes after President Donald Trump posted on social media that a deal had been reached regarding a “certain” company popular among young Americans, and just before a call was scheduled with Chinese President Xi Jinping.
The framework agreement comes as Washington has floated a ban in the absence of progress on national security issues. Reuters had previously reported that U.S. officials were prepared to follow through with the restrictions if Beijing did not make concessions related to tariffs and technology, an indication of how the TikTok issue has become enmeshed in wider economic negotiations. Negotiators from each country met in Madrid, as part of an economic policy dialogue ahead of today’s announcement.
What a ‘framework’ probably includes
Frameworks in cross-border national security reviews are generally in term sheet format, which sets forth the spine of the deal and refers to legal drafting that has yet been done. In the TikTok context, that generally includes ownership structure data governance compliance monitoring and a pathway to final approvals.” The Committee on Foreign Investment in the United States, a panel controlled by the Treasury that reviews foreign acquisitions for their potential effect on national security, has commonly demanded steps like data storage onshore, third-party audits and enforcement authority if terms are violated.
Having been thwarted in the past, observers will be watching whether the deal centres around a full divestiture of US operations or is a hybrid that leaves the core recommendation engine in Chinese hands under some sort of licensing model. China included recommendation algorithms on its export-control list in 2020, complicating any sale of TikTok’s underlying technology. A middle-of-the-road framework of sorts that combines operational control in the U.S. with licensing a product’s algorithms, handing over source code or supervised updates could be one way out of the impasse.
Oversight mechanics will be as important as ownership. Look for talk of independent U.S.-based trustees, ongoing monitoring and robust audit rights — as well as a potential “kill switch” giving regulators the power to shut down the app if commitments are broken. Previous plans called Project Texas, which relied on U.S. cloud partner and separate security teams, provide a playbook the parties might be able to refine rather than start over from scratch.
Politics and road to this point
The fate of TikTok has been dragged around by changing political currents. Congress approved legislation that laid the groundwork to ban the app if it was not separated from its China-based parent company, ByteDance. Although it was formally banned under that act, the platform has remained in operation as the two sides attempt to resolve their dispute. The White House has also said that a group of buyers had been identified, indicating the outlines of the private-party deal announced today were being set in place for months.
For Beijing, TikTok has become a stand-in for debates over data sovereignty and industrial policy. For Washington, the case is a test of whether it can address national security concerns about foreign influence and sensitive data without killing a consumer service used by tens of millions. Economic leverage on each side — the tariffs, market access and flows of technology that have repeatedly bled into the talks — has introduced a sense of high stakes to any deal.
What it means for users, creators and advertisers
TikTok contends that 150 million people in the United States use the app, which would make continuity a major challenge for its creators, small businesses and advertisers. Market researchers at Insider Intelligence have projected that TikTok’s ad revenue in the United States could reach more than $8 billion a year, and brands have been hesitant to allocate long-term budgets amid regulatory uncertainty. A framework offers the visibility that marketers need to plan spend, and it provides stability, which creators need to protect their income streams.
Operationally, continuity is in the realm of technical execution. Silos, local data and code review shops need to be bootstrapped, audited, but continue running intented to not compromise product quality. Any kind of structure that pauses algorithm updates, or even delays feature rollouts, risks quelling user engagement; which is why governance solutions built to maintain product velocity while adhering to security standards are so coveted in these transactions.
Highlights to watch for, next
First, the parties: the framework alludes to “two private parties,” suggesting that ByteDance and a buyer consortium have reached some sort of commercial agreement. The make-up of that group, and whether it includes strategic partners or just financial investors is going to determine control and regulatory comfort.
Second, the algorithm: if it’s about licensing rather than transfer, China’s regulators will need to sign off on export of the technology or terms of its ongoing use. That decision has long been a chokepoint.
Third, compliance infrastructure: wait for CFIUS to specify the oversight in its report, from third-party auditors to data-access logs and audit frequency. How transparent and enforceable those mechanisms are will determine if the framework itself can stand up to political pressure.
Finally, timing: formal documentation, national security accords and regulatory approvals need to all align before threats to ban are fully laid to rest. So as it stands now, the framework is a breakthrough — taking things from a yearslong stalemate to terms that are executable — but there is still onus on converting principles into implementable commitments with an enforceable and technically sound conclusion.