Chinese tech companies did a pretty good job convincing global investors that they operated independently from the Communist Party. Now, Jack Ma has become a case study for the firms’ biggest skeptics.
Companies from Alibaba Group Holding Ltd. to Tencent Holdings Ltd. splashed out billions on overseas acquisitions while developing apps and technologies that challenged Western rivals, with little or no state interference. But Beijing’s pursuit of Ma and his Ant Group Co. after he criticized regulators arguably plays directly into the hands of China’s biggest critics in Washington, who have long asserted that no Chinese tech giant or entrepreneur is beyond the reach of President Xi Jinping.
U.S. authorities are now debating whether to ban investments in Alibaba and Tencent, according to people familiar with the matter, in what would be a dramatic blow to two of the companies whose shares are most widely held by global investors. Already on Jan. 5, President Donald Trump signed an executive order banning transactions with eight Chinese software applications including Ant’s Alipay, and Tencent’s WeChat Pay, citing concerns that Beijing will have access to the data collected by the platforms. "I stand with President Trump’s commitment to protecting the privacy and security of Americans from threats posed by the Chinese Communist Party,” Commerce Secretary Wilbur Ross said in a statement on the order.