Alibaba has launched a legal challenge against the U.S. government after the Pentagon placed the Chinese technology group on a list of companies alleged to have ties to the country’s military.
The case, filed in a federal court in California, seeks to overturn the designation and remove Alibaba from the U.S. defence department’s 1260H list. The register identifies companies that Washington believes contribute to China’s military development through its policy of combining civilian innovation with defence objectives.
Alibaba said the findings “have no basis in fact or law,” arguing that officials failed to provide convincing evidence or give the company a proper opportunity to respond before adding its name.
The Pentagon reportedly based its decision partly on Alibaba’s compliance with Chinese technology regulations. The company rejected that reasoning, saying every business operating in China, including American multinationals, must follow the same domestic rules.
Alibaba also said its operations are centred on online retail, logistics, cloud computing, and digital services rather than military equipment or intelligence work. It added that none of the independent members of its board has an affiliation with China’s armed forces.
“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.
The expanded register also includes several other major Chinese businesses, such as search and artificial intelligence company Baidu and electric vehicle makers BYD and Nio.
Although the designation does not immediately freeze Alibaba’s assets or prevent it from operating in the United States, it could carry serious commercial consequences. From 30 June, the Pentagon will generally be barred from entering into contracts with companies included on the list.
Alibaba argues that the rules could also affect its relationships with American lawyers and lobbyists. U.S. defence contractors may face restrictions if they share professional advisers with a listed business, potentially encouraging firms to end their work with Alibaba to protect more valuable government contracts.
The company said it had previously offered to meet defence officials and submitted information addressing the military allegations, as well as evidence of its contribution to the U.S. economy. It claims the agency did not request further details and instead “designated Alibaba without notice or a fair hearing.”
The defence department declined to address the allegations, saying, “We do not comment on ongoing litigation.”