Alibaba wins ruling on lobbying ban tied to US blacklisting

[CALIFORNIA] Alibaba won a US court ruling in its challenge to a Department of Defense blacklist, testing Washington’s ability to curtail Chinese companies’ activities.

A federal judge in San Jose, California, on Monday (Oct 26) ordered the Trump administration to stop enforcing a ban on the Pentagon doing business with any company that engages in “lobbying activities” for Hangzhou, China-based Alibaba.

Washington’s most powerful lobbying firms rushed to sever ties with Alibaba and other Chinese tech giants after a new law targeting entities allegedly aiding China’s military took effect, Bloomberg News previously reported.

The restriction barred the Defense Department from working with any company represented by lobbyists who also work for entities blacklisted by the Pentagon for allegedly aiding the Chinese People’s Liberation Army.

In practice, the provision forced lobbyists to choose between the sanctioned Chinese companies and US defence contractors, causing them to abandon the former.

The San Jose judge did not rule on Alibaba’s challenge to being included on the Pentagon blacklist.

On Jun 8, the Pentagon added Alibaba to its roster of Chinese military companies operating in the US known as the 1260H list. The roster spans key sectors including semiconductors, artificial intelligence, robotics and drones.

The case is being closely watched as the blacklist has emerged as a prominent tool for the US in its rivalry with China.

Alibaba sued the department seeking its removal from the blacklist, saying it does not work with the Chinese military.

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Alibaba and Defense Department representatives did not immediately respond to requests for comment. BLOOMBERG