BEIJING (dpa-AFX) - President Donald Trump has signed an executive order approving a deal in which TikTok's U.S. application would be operated by a new joint-venture company based in the United States.
The deal, under which a group of mostly American investors take over the social media app's American business, saves the Chinese-owned TikTok from a ban in the United States.
The White House said that President Trump determined that the divestiture outlined in a proposed framework agreement is a 'qualified divestiture.'
It will be majority-owned by U.S. investors, operated in the U.S. by a board of directors with national security and cybersecurity credentials, and subject to strict rules to protect Americans' data and national security.
Tiktok's Chinese parent company ByteDance will hold less than 20 percent of the shares as required by law, choose only one director of the seven-seat board, and be excluded from the company's security committee, according to the White House.
The proposed divestiture resolves the national security concerns and complies with the Protecting Americans from Foreign Adversary Controlled Applications Act by removing TikTok in the United States from China's control, it added.
The Order directs the Attorney General not to take action to enforce the Act for 120 days to allow the divestiture to be completed.
Leading American technology company Oracle will act as TikTok's security provider and independently monitor and assure the safety of all operations in the U.S.
The Trump administration is of the view that ByteDance's links to the Chinese government threatens national security, and data security of the 170 million Americans who use TikTok.
American content creators rely on TikTok to build audiences, share their talents, and generate income in an increasingly digital economy.
Also, American businesses depend on TikTok's vast reach for advertising, connecting with customers, and driving economic growth.
Preserving TikTok's business will generate $178 billion in economic activity in the U.S. over the next four years and sustain thousands of U.S. jobs and businesses, the White House stated.
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