The agreement between Washington and Beijing on taking over Tiktok will bring about Chinese company Bytedance about 50% of the profits obtained in the US, although American shareholders are majority, according to the American administration, writes FT. The resources have said that the evaluation of $ 14 billion, announced by the White House, refers to a new company between Bytedance and No. Tiktok operation on the American market. However, they said that a significant part of the income generated in the US will continue to return to the parent company in China. «It is a perfect understanding: control remains in American capital, but most of the profit returns to Byteance,» said one of these investors. Financial details suggest that the relatively modest evaluation presented by the White House is explained, at least partially, that Byteance will keep a consistent right over future winnings. The joint venture approved by the Trump administration will manage the American version of the application and the video recommendation algorithm. President Donald Trump signed in the Oval Office on Thursday an executive order approving the agreement and grants a 120 -day deadline for the completion of the details. The new company attracts capital from Oracle, the investment fund Silver Lake and MGX in Abu Dhabi, which would have about 45% of shares together. A group of American investors, new and existing, will control 35%. Bytedance will remain with 19.9%, the maximum allowed by the American legislation. However, people close to the negotiations say that, through the licensing contracts for the algorithm and other commercial agreements, Byteance could even collect 50% or more of the profits obtained in the US. Although the agreement is not completed, investors like Atlantic General have expressed their optimism: «We are glad that an agreement has been reached. We expect the final documents to be signed in the next 120 days,» the shareholders sent. Trump said that China's President Xi Jinping agreed on the agreement, but the Beijing government has not explicitly confirmed this, against the background of commercial tensions between the two states. The Chinese Foreign Ministry has been limited to saying that «supports commercial negotiations between companies based on market rules and in accordance with Chinese legislation.» However, national security experts have raised question marks, especially in licensing the Tiktok algorithm in Byteance, which could continue to leave vulnerabilities. Although the Executive Order stipulates that the new company will manage the algorithm, the code and the moderation of the content, Oracle will have the role of closely monitoring the software updates, most likely, from Beijing. In 2022, Bytedance told American officials that the platform contains «2 billion lines», and Oracle estimated that a complete verification would take three years, according to the US Justice Department.
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