China holds firm on TikTok as US pushes for ownership shift

On Saturday, China restated its stance on TikTok's future in the United States, one day after President Donald Trump announced that a deal to put the short video app under US authority was in the works.

"The Chinese government respects the wishes of the enterprise, and welcomes it to carry out commercial negotiations in accordance with market rules to reach a solution compliant with China's laws and regulations, and strikes a balance of interests," a statement issued by China's Commerce Ministry read.

The ministry highlighted that this posture has remained unchanged throughout the last week.

The app, controlled by Beijing-based ByteDance, has become a hotspot in US-China ties, prompting questions about its corporate structure and the extent of Chinese influence over its technology.

With 170 million American users, TikTok's future has repercussions not only for the internet industry but also for global trade talks between the world's two largest economies.

Outstanding questions in the US-China talks

Trump was optimistic after his call on Friday with Chinese President Xi Jinping, but many big questions remain.

Topping the list are what the ultimate ownership structure for TikTok will be, how much of the app China may retain control of and what Beijing stands to gain from stepping away from one of its global tech success stories.

Even observers acknowledge that a breakthrough on TikTok might open progress in other fronts as well, such as agriculture and aviation.

The administration has been treating the fate of the app as part of sweeping trade concessions with China, turning it into a litmus test for the future of US-China trade.

In the meantime, the Commerce Ministry urged Washington to offer "an open, fair, equitable and non-discriminatory business environment for Chinese enterprises in the United States", such as TikTok.

Madrid framework agreement

Negotiators reached a framework agreement in Madrid earlier this week, which Chinese officials and state media swiftly hailed as a "win-win."

The agreement includes a review of TikTok's technology exports and intellectual property licensing, which have complicated negotiations over US ownership.

To avoid a TikTok shutdown in the United States, Trump felt that establishing the framework was an essential step.

If ByteDance did not sell its US assets, the app would have been forced to close for American users in January 2025, according to congressional legislation.

The Madrid agreement so extends the timescale and opens the possibility for future discussions; however, details about TikTok's US activities remain unclear.

Beijing’s broader demands

TikTok has deeper links to a push by China's Commerce Ministry that claims fairer treatment for Chinese companies abroad.

Ministry spokesman He Yadong repeated Beijing's hope at a news conference Thursday that the US will lower trade barriers to Chinese companies, implying that actions against TikTok are part of a wider deal-making process.

However, while officials in Beijing have said any settlement must adhere to market principles and Chinese law, they have shown some willingness to compromise by allowing the commercial negotiations to continue.

However, the ambiguity on the extent of control China will have over TikTok's technology continues to cast a shadow over the process.

High stakes beyond technology

The TikTok negotiations show Washington and Beijing's intersecting interests in technology, trade, and geopolitics.

For China, the app is one of its most notable global triumphs. The United States is concerned about data security, national influence, and economic leverage.

As both sides want to go beyond their tariff truce, TikTok's future has become a bargaining chip, with far-reaching ramifications.

The app's continued availability in the United States will be determined not only by company agreements but also by how the two governments manage their larger economic relationship.