The U.S. State Department has proposed President Donald Trump add FinTech Ant Group, which has strong ties to the Alibaba Group empire, to a list of foreign companies to which U.S. companies cannot sell certain technology, Reuters reported Wednesday (Oct. 14), citing sources.
A timeline for a decision by Trump and others involved in the process is unclear, Reuters said, and “... the move comes as China hardliners in the Trump administration are seeking to send a message to deter U.S. investors from taking part in the initial public offering for Ant Group. The dual listing in Shanghai and Hong Kong could be worth up to a record $35 billion.”
Federal officials think U.S. investors who buy shares in Ant Group could be defrauded and Ant could share private banking data of U.S. citizens with the Chinese government.
Reuters said the State Department did not immediately respond to a request for comment.
Ant, according to Reuters, dominates the mobile payments market in China and also offers loans and asset management services.
A key step in the process of choosing which companies belong on the list of those denied access to technology from U.S. companies is review by the federal End User Review Committee. That committee is led by the Department of Commerce and includes representatives of the State Department and Energy Department.
The list, the Defense Department web site states, “identifies foreign parties/entities, and those acting on their behalf, that have been involved in or pose a significant risk of becoming involved in activities that are contrary to the national security and foreign policy interest of the United States. Exports of almost all items subject to Commerce’s Export Administration Regulations require a license if destined to these entities.”
Reuters reported recently that China's securities regulators have delayed the Ant Group initial public offering (IPO).
The Financial Times reported Oct. 13 that Chinese regulators were concerned in part by a tool for taking part in the IPO that was to be included on an app for mobile devices.
One target of the Trump administration’s policies has been the sharing of artificial intelligence technology with Chinese firms.