Alibaba Sues Pentagon Over Military-Linked Company Designation

Chinese technology giant Alibaba has filed a federal lawsuit against the US Department of Defense over its designation as a military-linked company.

Alibaba has filed a lawsuit seeking removal from a Pentagon list of companies alleged to have ties to the Chinese military. (Photo: Andy Mitchell Flickr)

The company told Agence France-Presse (AFP) that the labeling was "arbitrary and capricious," CBS News reported.

The lawsuit, recently filed in federal court in San Jose, California, challenges the Pentagon's decision to include Alibaba on a list released this month of companies it says have ties to the Chinese military.

"The determinations have no basis in fact or law," the complaint stated.

Chinese companies BYD and Baidu have also said there was no basis for their inclusion on the list, while the Chinese Embassy accused the United States of "overstretching the concept of national security" and using discriminatory measures against Chinese firms.

"Alibaba is not a Chinese military company nor part of any military-civil fusion strategy," a company spokesperson told AFP.

"The decision to place Alibaba on the list is arbitrary and capricious, and we are filing a lawsuit against the Department of Defense to demand removal from the list," the spokesperson said.

The Pentagon's list includes 80 companies and their subsidiaries, among them Alibaba, Baidu and electric vehicle manufacturer BYD.

Under the designation, beginning June 30, the Pentagon will be prohibited from entering into new contracts with designated companies or their controlled subsidiaries.