Alibaba Challenges US Government Over Pentagon Blacklist
E-commerce giant Alibaba has initiated a significant legal action against the US government, seeking removal from a Pentagon blacklist that alleges connections to the Chinese military.
The US Department of Defense (DoD) asserts that Alibaba's compliance with Chinese technology regulators effectively makes it an extension of the Chinese military.
In a lawsuit filed in a federal court in California, Alibaba contested these claims, stating that the determinations "have no basis in fact or law".
This legal challenge follows the Pentagon's recent expansion of its blacklist, which now includes major technology companies such as Baidu, BYD, and Nio, barring them from conducting business with the US government after the end of the month.
The DoD designated Alibaba as a "military-civil fusion contributor to the Chinese defence industrial base" due to its regulatory connections with Beijing.
Alibaba refuted this characterization, emphasizing that none of its independent board members have any military affiliations.
The company highlighted that all multinational corporations operating in China, including American firms, must adhere to the same local regulations.
Alibaba further clarified that its platforms are designed for retail and cloud computing services, not for military or intelligence purposes.
"Alibaba is not a Chinese military company nor part of any military-civil fusion strategy," the company told the BBC.
"The decision to place Alibaba on the 1260H list is arbitrary and capricious, and we are filing a lawsuit against the Department of War to demand removal from the list," it added.
While the blacklist does not immediately freeze the company's finances, it imposes a severe operational restriction starting 30 June.
From that date, the Pentagon is legally prohibited from engaging in business with any blacklisted entity.
Importantly, this law also applies to any US contractor that shares lobbyists or law firms with a blacklisted company. Alibaba argues that this provision effectively blocks its long-term American advisers from maintaining relationships, as they must protect their own lucrative defense contracts.
This rule essentially deprives Alibaba of political and legal representation in Washington at a critical time when it is defending itself.
The complaint states that Alibaba had previously sought to engage with the agency to address concerns regarding its alleged Chinese military affiliations, including providing evidence of its economic contributions to the US.
However, Alibaba claims that despite these submissions, the agency neither raised concerns nor requested additional information. Instead, it "designated Alibaba without notice or a fair hearing," according to the complaint.
The DoD declined to comment on the lawsuit, stating to the BBC, "We do not comment on ongoing litigation."
