TikTok Achieves Settlement Through Deal Respecting International Investment Norms

TikTok announced Thursday the successful finalization of an ownership restructuring that resolves American security concerns while respecting international investment norms through negotiated compensation and ongoing financial interest. The deal demonstrates how forced divestment can occur within international legal frameworks.
The completed transaction reduces ByteDance’s ownership to a 19.9% minority stake, allowing continued financial participation rather than complete expropriation, while American investors control 80.1% through Oracle, Silver Lake, MGX, and Michael Dell’s firm. The structure provides ByteDance ongoing value from what it built while transferring control.
This settlement operates within international investment norms that generally disfavor uncompensated expropriation of foreign assets. While national security can justify requiring divestment, completely seizing valuable assets without compensation could violate bilateral investment treaties and international law norms. The structure allowing ByteDance to retain 19.9% ownership—and potentially participate in future value appreciation—provides ongoing compensation for what was forced transfer, making the arrangement more consistent with investment protection principles.
Leadership of the American entity will be entrusted to Adam Presser as CEO under American control satisfying security requirements, while ByteDance’s retained financial interest provides compensation element. The seven-member American-majority board governs the entity while ByteDance maintains investment stake. Shou Chew’s board participation provides some continuing voice proportionate to retained interest.
The new US entity operates under American control implementing comprehensive security—data protection, algorithm security, enhanced moderation, software integrity—satisfying national security requirements that justified requiring divestment. The recommendation algorithm trains independently on US data. Yet ByteDance’s 19.9% stake provides financial compensation for forced transfer, respecting property rights within security-justified divestment. Both governments approved this structure respecting investment norms while addressing security concerns.