Trump blocks US transactions with eight Chinese apps including Alipay

WASHINGTON (Reuters) – US President Donald Trump on Tuesday signed an executive order banning transactions with eight Chinese software applications, including the Ant Group’s Alipay mobile payment app, the White House said, two weeks before the presidential election in Beijing. Tension is growing with Joe Biden taking the position. .

A senior official told Reuters that the move, first reported by Reuters, aimed at preventing threats to Americans by Chinese software applications, with a large user base and access to sensitive data.

The order argued that the United States should take “aggressive action” against developers of Chinese software applications to protect national security.

It serves the Commerce Department to determine which transactions will be banned under the directive within 45 days and QQ Wallet and WeChat Pay of Tencent Holdings Ltd will also be targeted.

The order names CamScanner, SHAREit, Tencent QQ, VMate published by UCWeb, a subsidiary of Alibaba Group and the WPS office of Beijing Kingsoft Office Software.

“By accessing personal electronic devices such as smartphones, tablets, and computers, Chinese-connected software applications can access and capture vast swats of information from users, including sensitive personally identifiable information and personal information,” in the executive order Having said.

Such data collection would “allow China to track the locations of federal employees and contractors and create dossiers of personal information,” the document says.

China took necessary measures to protect the legitimate rights of companies in the wake of Trump’s order, Foreign Ministry spokesman Hua Chunying said in a regular briefing on Wednesday that the US was abusing its national power and improperly lending foreign companies Was suppressing

In a statement late Wednesday evening, China’s Commerce Ministry said the US ban is against fair competition.

FILE PHOTO: A logo of Alipay, an electronic payment service associated with Ant Group Company Limited, was spotted in a vending machine on December 30, 2020 in Beijing, China. REUTERS / Thomas Peter / File Photo

The ministry said it also harms the interests of Chinese companies and their customers in the United States who were “widely welcomed” during the epidemic as a contactless payment option.

Kingsoft said in a statement published by Chinese state media that it was not expected by Trump’s order to significantly affect the company’s business in the short run. Ant, the Biden transition team and SHAREit declined to comment.

Alibaba, Tencent, CamScanner and the Chinese Embassy in Washington did not immediately respond to requests for comment.

The order aims to cement Trump’s tough-on-China legacy, on Jan. 20 by Biden, a Democrat who has said little about plans to address specific technical threats from China.

However, Biden may rescind the order on the first day of his presidency, although his transition team did not immediately respond to a request for comment on the matter.

The order would further heighten tensions between Washington and Beijing, locked in a bitter dispute over the origins of coronovirus and a Chinese attack on Hong Kong.

Despite the 45-day timeline as ordered, the Commerce Department planned to act before Jan. 20 to identify prohibited transactions, another U.S. official told Reuters.

Directive mirror Trump’s executive orders signed in August directing commerce to block some US transactions with WeChat and the Chinese-owned video app TikTok.

Had those orders come into force, they would have effectively banned the use of Chinese apps in the United States and prohibited Apple Inc. and Alphabet Inc.’s app stores from offering downloads to new users.

However, the restrictions were primarily stayed by the courts on freedom of speech. The White House is confident the new sanctions will stand up to judicial scrutiny, as applications such as Alipay will struggle to bring up the First Amendment case, a senior administration official told Reuters.

US Commerce Secretary Wilbur Ross said in a statement that he supports Trump’s “commitment to protect the privacy and security of Americans from threats posed by the Chinese Communist Party.”

Alipay has been in Cross Hair, Washington for months.

Reuters reported in November that the US State Department had proposed to add Ant Group to a trade blacklist to prevent US investors from participating in its lucrative initial public offer. But the Commerce Department, which oversees the blacklist, turned down the offer after Michael Evans, chairman of Alibaba Group Holding Inc., urged it to reject the bid.

Ant is China’s leading mobile payment company, which provides loan, payment, insurance and asset management services through mobile apps. It is 33% owned by Alibaba and controlled by Alibaba founder Jack Ma, but is not currently available to US users.

According to research firm SensorTower, Alipay was downloaded 207,000 times in 2020 from Apple’s US App Store and Google Play, while image scanning app CamScanner and Office Suite app WPS Office were downloaded 4.4 million and 563,000 times, respectively.

Tuesday’s move is the latest in a string of stringent new allegations against Chinese companies.

The White House in November revealed an executive order banning US investment in Chinese military companies, including China’s top chipmaker SMIC and oil giant CNOOC. Last month, the Commerce Department included dozens of Chinese companies on a trade list, including Chinese drone manufacturer SZ DJI Technology Co Ltd.

Reporting by Alexandra Elper and David Shepperson in Washington; Additional reporting by Brenda Goh and Josh Horwitz in Shanghai; Pei Li in Beijing and Gabriel Crossley in Beijing; Editing by Matthew Lewis, Leslie Adler, Lincoln Feast and Giles Elgood


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