TikTok establishes new U.S. joint venture to avoid American ban

TikTok announced on Thursday the establishment of a joint venture, TikTok U.S. Data Security Joint Venture LLC (TikTok USDS JV), a new entity with majority American ownership. The company will manage data protection, algorithm security, content moderation and software assurance for TikTok's U.S. operations.

The announcement also noted that TikTok USDS JV will manage certain commercial activities including e-commerce, advertising and marketing, as well as the platform's global product interoperability.

The entity represents a milestone in avoiding a U.S. ban on the popular social media app and will allow more than 200 million American users to continue accessing the platform.

According to the announcement, American and global investors will hold a combined stake of 80.1 percent, with Oracle, Silver Lake and MGX each holding a 15-percent stake in the TikTok USDS JV. ByteDance, TikTok's parent company, will retain a 19.9 percent stake. The joint venture will be governed by a seven-member board of directors, which will include TikTok CEO, Shou Chew.