Bytedance said that in order to ensure that 100 million American users can continue to use TikTok, meet US government regulatory requirements, and strengthen TikTok’s US business. Bytedance, Oracle, and Wal-Mart had formed a principled consensus on TikTok’s cooperation. The three parties will advance the negotiation in accordance with the relevant consensus and hope to reach a cooperation agreement that meets the legal requirements of the United States and China as soon as possible.
In response to some rumors about the tripartite cooperation, we at this moment clarify as follows:
Rumor 1: The main shareholder of TikTok Global is an American investor, and ByteDance will lose control of TikTok.
The actual situation: TikTok Global is a 100% subsidiary of Bytedance, headquartered in the United States. TikTok Global plans to launch a small round of Pre-IPO financing. After the financing, TikTok Global will become a subsidiary of Bytedance holding 80%. The board of directors of TikTok Global includes the founder and current director of Bytedance, as well as the CEO of Wal-Mart. TikTok Global will also launch a listing plan to further enhance the corporate governance structure and transparency.
Rumor 2: Oracle may use and possess the source code of TikTok.
Actual situation: The current plan does not involve the transfer of any algorithms and technologies. Oracle has security inspection authority for the TikTok US source code. Displaying the source code is a universal solution for multinational companies to face local data security concerns. In 2016, Microsoft established a Technology Transparency Center in Beijing, where Chinese technical experts can view the source code of Microsoft products and services to test their security. In 2019, Cisco opened a technical verification service center in Bonn, Germany, to publicly verify the compliance of its 5G source code to the German Federal Information Security Agency.
Rumor 3: TikTok Global will pay US $5 billion in taxes to the US Department of the Treasury for this plan.
The actual situation: The so-called US$5 billion in taxes to the US Treasury Department is a prediction of the corporate income tax and other operating taxes that TikTok will need to pay for business development in the next few years. TikTok is full of confidence in the future development, but the actual tax amount still needs to be determined according to the actual development of the business and the tax structure of the United States. The tax forecast has nothing to do with this cooperation plan.
Rumor 4: About the education fund totaling 5 billion US dollars.
The actual situation: We are also the first time we heard about the $5 billion education fund from the news. The company has been committed to investing in the education field and plans to work with partners and global shareholders to launch online classroom projects based on AI and video technology for students around the world.