Tariffs delay deadline for TikTok sale…again
TikTok, the beloved video platform that has had Washington in a twist, is back in limbo.
What was once just a viral dance platform has now become emblematic – a rope in a high stakes geopolitical tug-of-war.
An initial ban over national security concern was introduced, then reversed, and ultimately the app has been treading uncharted waters after a number of delays.
But, just last week, it looked like the stalemate was finally ending – with a deal finally being struck at the White House.
Yet, just days later, President Trump’s latest tariff salvo threw the whole deal into disarray.
China ultimately declined to approve the deal, amidst and escalating trade war between the two most powerful countries in the world.
Trump’s latest executive order has given the app yet another 75 days to reach a deal – and ideally avert a US ban.
(Almost) a done deal
Last Wednesday, the US government believed it had cracked the code, reported The Hill.
ByteDance – TikTok’s parent firm – and a group of American investors, had agreed to a new ownership structure meant to satisfy national security concerns.
This deal would see a new American entity replace TikTok’s American market, in which new US investors would hold a 50 per cent stake – and current investors 30 per cent.
Meanwhile, ByteDance would keep a small stake of less than 20 per cent in the firm.
Everyone, even Beijing, seemed ready to greenlight this arrangement.
But within 48 hours, the deal had unravelled.
After Trump announced steep new tariffs on Chinese goods, including a staggering 125 per cent rate, Beijing pulled back.
ByteDance informed the White House that, due to the trade escalation, the Chinese government would no longer approve of the deal.
Tiktok has found itself once again in limbo.
Tariffs trigger the collapse
Trump sparked an economic scuffle with China by introducing a 34 per cent tariff on Chinese goods.
On top of an existing 20 per cent rate, China was set to face more than 50 per cent on tariffs.
Beijing responded by announcing a 34 per cent tariff on all American goods.
Trump didn’t hold back. In turn, he levied an additional 50 per cent reciprocal tariff on China, totalling to 104 per cent total import tax. This law went into effect immediately on Wednesday.
The tit-for-tat tax spat continued, and Beijing, once again, responded by applying a 84 per cent tax on American goods.
The US President deepened his trade war on Wednesday, hiking tariffs on China to a staggering 125 per cent, while easing them on nearly all other nations.
The trade fight spilled directly into TikTok’s negotiations.
ByteDance – no longer confident of Beijing’s support – pulled out of the deal, saying it couldn’t proceed under the new climate.
“If I gave a little cut in tariffs”, Trump told reporters at Air France One, “they’d approve that deal in 15 minutes. Which shows you the power of tariffs, right?”
Another delay
In response to the collapse, Trump signed (yet another) executive order, delaying the enforcement of the law that required ByteDance to divest.
The initial 75-day deadline had just expired Saturday, so the app has been granted another 75 days to find a solution.
Trump lauded the “tremendous progress” his administration had made on the deal, despite acknowledging that it “requires more work to ensure all necessary approvals are signed.”
Yet, sources close to the matter revealed that a deal had already been approved by investors, ByteDance, and US officials, before the tariff chaos upended everything.
‘MAGA propaganda machine’
Experts suggest Trump’s tariff escalation may have backfired.
“This national security imperative to divest from ByteDance is now giving China leverage”, said Sarah Kreps, director of Cornell’s Tech Policy Institute. “They now have bargaining power because this deal can’t go forward unless they agree to it.”
Gary Clyde Hufbauer from the Peterson Institute added: “Trump has gone so overboard with the tariffs and has gotten into such a mano battle with president Xi that it’s hard to see a happy resolution from Trump’s standpoint.”
Meanwhile, there’s political fallout back on US soil.
Critics argue that Trump’s second 75-day delay violates the law, which only allowed for one 90-day extension.
“This is 100 per cent illegal” said US senator Chris Murphy. “Trump seems to be biding time to work out a deal where one of his allies takes over TikTok and turns it into a MAGA propaganda machine”.
Senator Mark Warner echoed these concerns, warning that tying national security decisions to trade negotiations sets a dangerous precedent.
Meanwhile, another US senator, John Moolenaar, was more direct: “A deal that keeps ByteDance in control wouldn’t just miss the mark, it would violate the law.”
Broader implications
As talks stall and deadlines extend, some say the TikTok saga has far wider implications.
“It’s about the broader US-China relationship”, said Jennifer Huddleston of the Cato Institute. “And a larger debate about foreign tech companies operating in the US.”
ByteDance itself has been quiet. On Friday, the firm acknowledged it had been in talks, but said any final decision would depend on Chinese law.
“There are key matters to be resolved”, a spokesperson said. “Any agreement will be subject to approval under Chinese law”.
With TikTok caught between two titanic powers and the clock reset once more, June is shaping up to be another defining month.
Or, as an expert told the New York Times: “We may find ourselves back in Groundhog Day 75 days from now, unless the tariffs are resolved.”