ByteDance is shooting down the U.S. optimism surrounding the TikTok deal with Walmart Inc WMT, and Oracle Corporation ORCL.
What Happened: Neither U.S. company will not gain ownership rights for TikTok’s video recommendation algorithms or the technology that powers the app, ByteDance said in a statement in Chinese, according to CNBC.
Oracle will only have "the authority to check the source code" for TikTok in the U.S.
ByteDance also said in a statement, it would continue to hold an 80% stake in TikTok's global operations, CNBC reported separately, with Oracle owning 12.5% and Walmart a 7.5% stake in the short-form video app.
Why Does It Matter: President Donald Trump gave his "blessing" to the TikTok-Oracle-Walmart deal on Saturday.
Trump wanted a deal that would not only dissociate all U.S. based TikTok operations from China but also generate more money for the United States Treasury.
“It’ll be a brand new company. It will have nothing to do with any outside land, any outside country, it will have nothing to do with China,” the President had said, according to CNBC.
ByteDance denied Trump's claim of it paying $5 billion in new taxes to the U.S. Treasury. The Chinese company said it was just a "forecast" of corporate and other taxes it would owe to the U.S. government over the next few years and had nothing to deal with this deal, CNBC reported.
Earlier in the day, in a social media post, ByteDance said it didn't hear about the $5 billion education project that Trump said the TikTok deal would fund — until media reports emerged.
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