US officials weigh adding Alibaba, Tencent to investment ban

[WASHINGTON] Senior US officials are debating whether to bar investments in Alibaba Group Holding and Tencent Holdings, according to people with knowledge of the talks, potentially expanding a Wall Street blacklist that's already cost shareholders billions of dollars.

The State Department, Department of Defence and Treasury Department are among authorities involved in the deliberations, said the people, speaking on the condition they not be named because the talks are confidential.

Alibaba and Tencent are two of China's most valuable companies and their equity securities are widely held by US investors.

US authorities have been ramping up efforts to deprive Chinese companies of US capital in the final months of President Donald Trump's administration, adding to economic tensions as President-elect Joe Biden prepares to take over this month.

Hasty measures have at times sown confusion in markets and prompted price swings, such as when the New York Stock Exchange reversed course twice this week on a decision to delist three Chinese telecommunications companies.

The discussions involving Alibaba and Tencent focus in part on how such a move might affect capital markets, according to a Wall Street Journal report on the talks earlier on Wednesday.

Representatives for the companies didn't immediately respond to messages seeking comment.

Citing national security, Mr Trump previously signed an executive order in November requiring investors to pull out of Chinese companies linked to that nation's military.

On Tuesday, Mr Trump signed an order banning US transactions with eight Chinese apps including Ant Group's Alipay and Tencent's digital wallets. It will be up to Mr Biden to decide whether to enforce that policy once it takes effect.

Those developments and continuing discussions are a blow to billionaire Jack Ma's internet empire.

He hasn't been seen in public since Chinese regulators halted Ant's US$35 billion IPO and launched an antitrust probe into Alibaba.

BLOOMBERG