The deal struck by China’s ByteDance with Oracle and Walmart over the future of video-streaming app TikTok appears to be on very shaky ground, with the Global Times newspaper warning the agreement is unlikely to receive Chinese government endorsement, and US President Donald Trump saying his administration won’t approve it if Bytedance retains control.
ByteDance has said it will create a US “subsidiary”, TikTok Global, that will be part-owned by Oracle and Walmart – which in turn said TikTok Global’s board would comprise mainly Americans – to pacify the Trump administration, which had planned to ban TikTok on security grounds.
But Trump said on Monday said his administration would not approve the sale of TikTok to Oracle and Walmart if China’s ByteDance maintains any control.
“If we find that they don’t have total control, then we’re not going to approve the deal… We will be watching it very closely,” Trump told Fox News in an interview.
Meanwhile, the English and Chinese editions of the state tabloid, the Global Times, carried an editorial on Monday which said: “It is clear that these articles (terms) extensively show Washington’s bullying style and hooligan logic. They hurt China’s national security, interests and dignity.”
The unidentified author objected to a requirement that four of the five board seats of TikTok Global be occupied by Americans and only one reserved for a Chinese national, as well as the inclusion of a US-approved “national security director”.
It also denounced a requirement that ByteDance reveal TikTok’s source code to Oracle as part of the latter’s stake purchase, as well as the separate management of TikTok from Chinese equivalent Douyin.
“As TikTok and Douyin should have the same source code, this means the US can get to know the operations of Douyin,” the editorial continued.
“If the reorganisation of TikTok under US manipulation becomes a model, it means once any successful Chinese company expands its business to the US and becomes competitive, it will be targeted by the US and turned into a US-controlled company via trickery and coercion, which eventually serves only US interests,” the author wrote.
The Global Times is a tabloid published by the People’s Daily, the official newspaper of China’s ruling Communist Party, but does not speak on behalf of the party and government unlike its parent publication.
Over the weekend, ByteDance and Oracle announced they had reached a deal that would satisfy Trump’s call for TikTok to be sold to an American buyer or face shutdown in the United States.
However, both sides have framed the deal differently in public statements.
ByteDance has said TikTok Global will be its subsidiary of which it will own 80%.
Oracle has said ByteDance’s ownership would be distributed to ByteDance’s investors, many of which are US-based and that the Beijing-based firm itself would have no stake in TikTok Global.
The deal requires approval from regulators in both Beijing and Washington.
(Reporting by Josh Horwitz for Reuters; Editing by Christopher Cushing)