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TikTok has moved closer to securing its long-term future in the United States by placing its US operations under a new joint venture structure, according to information shared internally and reported by foreign media.

The new entity has been named TikTok USDS Joint Venture LLC. It is expected to formally close on January 22, aligning with timelines set under a US national security framework that required the divestment of TikTok’s American business from its China-based parent, ByteDance.

The restructuring follows an executive order signed in September that approved a proposed transaction allowing TikTok to continue operating in the US, subject to safeguards around data protection and national security. The move came after a law upheld earlier this year mandated the sale of TikTok’s US assets or an effective ban.

Under the proposed structure, American and global investors will hold a majority stake in the new US entity. A consortium of new investors will own 50 per cent of the joint venture, with Oracle, Silver Lake and Abu Dhabi-based MGX holding 15 per cent each. Affiliates of certain existing ByteDance investors will own just over 30 per cent, while ByteDance will retain a stake of nearly 20 per cent.

Overall, American and global investors will control about 80 per cent of the venture, ensuring majority ownership outside China. Governance will be overseen by a seven-member board, with Americans holding most of the seats.

The US joint venture will be responsible for US user data protection, algorithm security, content moderation and software assurance. Sensitive American user data will be stored on US-based cloud infrastructure, with Oracle acting as the trusted security partner. Its role includes auditing and validating compliance with agreed national security terms.

The arrangement also includes retraining TikTok’s core content recommendation algorithm using US user data. This step is aimed at ensuring that the content feed remains insulated from external or foreign influence.

While the US entity will operate independently on security and data matters, TikTok’s global teams will continue to manage global product interoperability and certain commercial activities such as advertising, marketing and e-commerce.

The deal represents a major milestone after years of uncertainty around TikTok’s presence in the US. The video platform is used by more than 170 million Americans and has faced regulatory pressure since 2020 over concerns linked to data access and national security.

The executive order issued in September temporarily paused enforcement of the divestment law for 120 days, allowing time for the transaction to be completed by late January. The proposed structure broadly mirrors the framework outlined when enforcement was delayed.

Market reaction was positive, with Oracle shares rising about 5 per cent in after-hours trading following reports of the agreement.

Once completed, the transaction is expected to bring an end to prolonged efforts to force ByteDance to exit TikTok’s US business, while keeping the app available to American users under a US-controlled structure.