Chinese e-commerce and technology giant Alibaba has formally filed a lawsuit in a U.S. federal court, challenging the Pentagon’s decision to place it on the “Chinese Military-Related Companies List” (the 1260H list). The company is seeking to overturn the designation and restore its normal business operations in the U.S. market.
The U.S. Department of Defense previously added Alibaba to the blacklist, arguing that because the company must comply with China’s technology regulatory framework, it is effectively part of the country’s “civil-military fusion” system and therefore linked to the Chinese military. The list also includes major Chinese firms such as Baidu, BYD, and NIO, and places them under gradually tightening business restrictions.
In its legal filing, Alibaba strongly denied these allegations, describing the U.S. determination as having “no factual or legal basis.” The company stressed that its board has no military background and that its core businesses are focused on e-commerce and cloud computing, not military or intelligence activities. It also argued that all foreign companies operating in China—including American firms—are subject to the same local laws and regulations, and should not be considered connected to the military as a result.
Alibaba told the BBC that it is not part of any so-called military-industrial system, calling the decision to list it “arbitrary and lacking transparency,” and criticising the U.S. for imposing sanctions without providing sufficient hearings or specific evidence.
Under U.S. regulations, the restrictions are expected to tighten further after June 30. The Pentagon will be prohibited from engaging in business with companies on the list, and contractors will also face limits on indirect dealings, potentially weakening firms’ access to legal and commercial support in the U.S. market.
Commentary:
Alibaba’s lawsuit against the U.S. Department of Defense reflects the accelerating shift of U.S.–China technological competition toward institutionalisation and securitisation.
Washington’s reliance on concepts such as “civil-military fusion” and China’s regulatory environment as justification for blacklisting Alibaba risks expanding an already ambiguous standard. If applied broadly, it could potentially classify any company legally operating in China as a security risk, further increasing uncertainty in global markets.
At the same time, China has responded with countermeasures, imposing export controls on several U.S. companies involved in defence and rare earth mining. This escalating contest over technology, law, and security frameworks also casts a shadow over recent efforts by U.S. President Donald Trump and Chinese President Xi Jinping to stabilise bilateral relations following their meeting last month.