The United States Department of State has submitted a proposal for the administration of US President Donald Trump to add China’s Ant Group to a trade blacklist, two people familiar with the matter told Reuters news agency, before the fintech arm of e-commerce giant Alibaba is slated to go public.
It was not immediately clear when the US government agencies that decide whether to add a company to the so-called Entity List would review the matter. But the move comes as China hardliners in the Trump administration are seeking to send a message to deter US investors from taking part in the initial public offering, worth up to a record $35bn. They fear buying shares in the company could expose them to fraud or that Ant could give the Chinese government access to sensitive banking data belonging to US citizens.
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The State Department did not immediately respond to a request for comment from Reuters news agency.
The entity list, which makes it more difficult for US firms to sell high-tech items to blacklisted companies, has become the tool of choice for the Trump administration to punish Chinese companies, though its real-world impact is sometimes questionable.
While curbing access to US technology deals a blow to companies like Chinese telecoms giant Huawei Technologies, which was added in May 2019, its impact on a fintech giant like Ant Group is likely to be more symbolic.