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Trump bars US transactions with eight Chinese apps

Washington

US President Donald Trump on Tuesday signed an executive order banning transactions with eight Chinese software applications, including Ant Group's Alipay mobile payment app, the White House said, escalating tensions with Beijing two weeks before President-elect Joe Biden takes office.

The move is aimed at curbing the threat to Americans posed by Chinese software applications, which have large user bases and access to sensitive data, said a senior administration official.

The order argues that the United States must take "aggressive action" against developers of Chinese software applications to protect national security.

It tasks the Commerce Department with defining which transactions will be banned under the directive within 45 days, and targets Tencent Holdings' QQ Wallet and WeChat Pay as well.

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The order also names CamScanner, SHAREit, Tencent QQ, VMate which is published by Alibaba Group subsidiary UCWeb, and Beijing Kingsoft Office Software's WPS Office.

"By accessing personal electronic devices such as smartphones, tablets and computers, Chinese connected software applications can access and capture vast swaths of information from users, including sensitive personally identifiable information and private information," the executive order states.

Such data collection "would permit China to track the locations of federal employees and contractors, and build dossiers of personal information", the document adds.

China will take necessary measures to safeguard the legitimate rights of companies in view of the Trump order, foreign ministry spokesperson Hua Chunying told a regular briefing on Wednesday, adding that the US was abusing its national power and unreasonably suppressing foreign companies.

Kingsoft said in a statement published by Chinese state media that it did not expect Mr Trump's order to substantially impact the company's business in the short term.

The order aims to cement Mr Trump's tough-on-China legacy before the Jan 20 inauguration of Mr Biden, who has said little about how he plans to address specific tech threats from China.

Mr Biden could, however, revoke the order on the first day of his presidency, though his transition team did not immediately respond to a request for comment on the matter.

The order will likely ratchet up tensions further between Washington and Beijing, which have been locked in a bitter dispute over the origins of Covid-19 and a Chinese crackdown on Hong Kong.

Despite the 45-day timeline laid out by the order, the Commerce Department plans to act before Jan 20 to identify prohibited transactions, said another US official.

The directive mirrors Mr Trump's executive orders signed in August directing Commerce to block some US transactions with WeChat and the Chinese-owned video app TikTok.

Had those orders gone into effect, they would have effectively banned the Chinese apps' use in the US, and barred Apple and Alphabet's app stores from offering them for download for new users.

The restrictions, however, were blocked by courts mainly on freedom of speech grounds. The White House is confident the new restrictions will stand up to judicial scrutiny, since applications like Alipay would struggle to bring a First Amendment case, said the senior administration official.

US Secretary of Commerce Wilbur Ross said in a statement that he supports Mr Trump's "commitment to protecting the privacy and security of Americans from threats posed by the Chinese Communist Party". Alipay has been in Washington's cross hairs for months.

Reuters reported in November that the US State Department had submitted a proposal to add Ant Group to a trade blacklist in order to deter US investors from taking part in its lucrative initial public offering. But the Commerce Department, which oversees the blacklist, shelved the proposal after Alibaba Group Holding president Michael Evans urged Mr Ross to reject the bid.

Ant is China's dominant mobile payments company, offering loans, payments, insurance and asset management services via mobile apps. It is 33 per cent owned by Alibaba and controlled by Alibaba founder Jack Ma, but is currently unavailable for American users.

Alipay was downloaded from Apple's US app store and Google Play 207,000 times in 2020, while image scanning app CamScanner and office suite app WPS Office were downloaded 4.4 million and 563,000 times respectively, said research firm SensorTower. REUTERS

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