China reportedly backed out of a deal to sell TikTok to U.S. investors a day after President Donald Trump announced wide-ranging global tariffs. 

Sources told The Associated Press that ByteDance, TikTok’s Chinese-owned parent company, called the White House Thursday to inform them that China will no longer approve a deal unless there are negotiations on trade and tariffs.

On Friday, Trump said he’ll sign an executive order to keep TikTok running in the U.S. for an additional 75 days as his administration finalizes a deal to divest the platform from China.  

Under a law upheld by the Supreme Court, ByteDance is required to sell the platform to an approved buyer or take it offline in the United States. Lawmakers and the high court agreed that the ban – or the sale – is necessary for national security. The initial deadline for the sale was Jan. 19, but Trump granted an extension immediately after taking office. He extended the deadline for a second time on Friday. 

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TikTok deal now uncertain

Dig deeper:

According to the AP, White House officials believed they were close to a deal for TikTok’s operations to be spun off into a new company based in the U.S. and owned and operated by a majority of American investors, with China’s ByteDance maintaining a minority position, according to a person familiar with the matter.

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The near-deal was constructed over the course of months, with Vice President JD Vance’s team negotiating directly with several potential investors and officials from ByteDance. The plan called for a 120-day closing period to finalize the paperwork and financing. The deal also had the approval of existing investors, new investors, ByteDance and the administration.

But on Friday it became uncertain whether a tentative deal could be announced after the Chinese government’s reversal of its position. 

What they’re saying:

The Trump administration had confidence that China would approve the proposed deal until the tariffs went into effect. Trump indicated Friday that he can still get a deal done during the 75-day extension.

“My Administration has been working very hard on a Deal to SAVE TIKTOK, and we have made tremendous progress,” Trump posted on his social media platform. “The Deal requires more work to ensure all necessary approvals are signed, which is why I am signing an Executive Order to keep TikTok up and running for an additional 75 days.”

Trump added, “We look forward to working with TikTok and China to close the Deal.”

A spokesperson for ByteDance confirmed in a statement that the company has been discussing a “potential solution” with the U.S. government but noted that an “agreement has not been executed.”

“There are key matters to be resolved,” the spokesperson said. “Any agreement will be subject to approval under Chinese law.”

How does the new TikTok deal work? 

According to The Information, the wildly popular social media app is expected to be called TikTok America and be about 50% owned by new U.S. investors. The plan could include licensing TikTok’s algorithm from ByteDance. 

Big picture view:

The U.S. has said it’s concerned about TikTok collecting vast swaths of user data, including sensitive information on viewing habits, that could fall into the hands of the Chinese government through coercion. Officials have also warned the algorithm that fuels what users see on the app is vulnerable to manipulation by Chinese authorities, who can use it to shape content on the platform in a way that’s difficult to detect.

The other side:

Chris Pierson, CEO of the cybersecurity and privacy protection platform BlackCloak, said that if the algorithm is still controlled by ByteDance, then it is still “controlled by a company that is in a foreign, adversarial nation-state that actually could use that data for other means.”

“The main reason for all this is the control of data and the control of the algorithm,” said Pierson, who served on the Department of Homeland Security’s Privacy Committee and Cybersecurity Subcommittee for more than a decade. “If neither of those two things change, then it has not changed the underlying purpose, and it has not changed the underlying risks that are presented.”

Who wants to buy TikTok? 

Amazon, the software company Oracle and Blackstone investment firm are among the companies that have placed bids for TikTok. According to The Wall Street Journal, AppLovin has also made a bid to acquire TikTok.

RELATED: TikTok bidding war: Amazon reportedly casts last-minute offer

A consortium organized by billionaire businessman Frank McCourt, who recently recruited Reddit co-founder Alexis Ohanian as a strategic adviser, has also made an offer. Investors in the consortium say they’ve offered ByteDance $20 billion in cash for TikTok’s U.S. platform. If successful, they plan to redesign the popular app with blockchain technology they say will provide users with more control over their online data.

Jesse Tinsley, the founder of the payroll firm Employer.com, says he too has organized a consortium, which includes the CEO of the video game platform Roblox, and is offering ByteDance more than $30 billion for TikTok.

Trump said in January that Microsoft was also eyeing the app. Other interested parties include Trump’s former Treasury secretary Steve Mnuchin and Rumble, the video site popular with some conservatives and far-right groups. In a post on X last March, Rumble said it was ready to join a consortium of parties interested in purchasing TikTok and serving as a tech partner for the company.