The governance model of China's major technology companies is about Alibaba's demand against the Pentagon
Originally published in Global Voices in Spanish
Image created by Oiwan Lam with Cova.
This article is part of the Global Voices Spotlight series of October 2026 "Technological Giants and Authoritarianism. "This series explores how giant technology companies facilitate and hinder governments and authoritarian practices, and how these decisions influence developing countries. You can support this coverage with a donation.
In June 2026, when the United States Department of Defense expanded its section list 1260H of "Chinese military companies operating in the United States", three dominant technology companies and Internet giants - Baidu, Alibaba and Tencent (BAT) - were identified as an extension of the Chinese State and subject to the Pentagon's acquisition ban that excludes them from the Department of Defense supply chain. The list also points to an increase in the risk of further sanctions from the Department of Commerce or the Treasury.
Alibaba protested against the classification with a claim to the Pentagon. In judicial record, Alibaba denied any affiliation with the Chinese Army or any role in the State-led military-civilian fusion strategy. He claims that the list and prohibition "has no factual or legal basis" and deprives the company of future business opportunities. He also claims that the abrupt announcement has violated the company's constitutional right to explain its position.
Section 1260H was presented in 2021 to treat the so-called Chinese state strategy of the "Military-civil fusion"which facilitates the transfer of technology or commercial research from technology companies to Chinese defence bases. The Statement by the Department of Defence describes Alibaba as "indirectly affiliated with the supervision of state assets and administrative commission of the State Council of the People's Republic of China, and collaborator of the" military-civil merger to the Chinese industrial defence base "because it is affiliated with the Chinese Ministry of Industry and Information Technology.
Leaving aside the debate on procedural justice, public records, especially international and national news reportswhich the Department of Defense presented to the court as evidence of its decision largely reflects the authoritarian nature of the governance of China's large technology companies, and highlights Alibaba's strategic convergence with the Chinese Government's censorship, technology and military development strategy.
Law and business
The Department of Defense cites news reports on China's censorship and Alibaba's official document on its technological development milestone in its court presentation, suggesting that the company has an active role in building China's censorship regime.
China certainly has several laws and regulations. For example, the cybersecurity law (2017) provides that network operators must monitor, stop and remove prohibited content; preserve records and report incidents to government authorities. The government provisions of the cyberinformation content ecosystem (2020) they classify content into three main categories: positive, illegal and negative, and require operators to promote, eliminate and delete accordingly. The laws on IA prohibit using algorithms to "influence public opinion" or encourage excessive addition and consumption, and to ensure that generative IA models adhere to "fundamental socialist values."
Alibaba argued that compliance with Chinese regulations should not be interpreted as evidence of military ties, as all multinational companies operating in China, including US companies, must comply with local standards.
However, the public record that the Pentagon presented to the court suggests that Alibaba not only meets the requirements of censorship on its consumer platforms, generative IA and mobile browsers, but also develops censorship technology, such as Alibaba's "Green IA" that automates real-time filtration in text, images, voice, video and continuous transmission data, and sells content moderation tools to national and foreign programmers, e-commerce vendors, video transmission services and games platforms, so that they can function within China's legal requirements.
Alleged affiliations and strategic convergence
Beyond assisting and exporting censorship technology, which has no military purposes, the Department of Defense judicial file also includes news and comments on the disappearance of its founder, Jack Ma, in late November 2020.
Prior to the disappearance of Jack Ma on 24 October 2020, he criticized China's banking system as obsolete, and then, on 3 November, the dual offer of Ant Finance from Alibaba for $37 billion in the Shanghai and Hong Kong stock market was suspended. His disappearance coincided with the anti-monopoly investigation by the Chinese authorities against Alibaba, which in the end received a fine of 2750 million for forcing traders to choose between platforms.
The Department of Defence also suggested that Alibaba's "indirect affiliation" with the supervision of State assets and the State Council's administrative commission and majority links through the profile of the joint venture, in particular its association with Norinco GroupState-owned Chinese military company sanctioned by the U.S. Treasury Department, to establish Qianxun Intelligence, which makes an IA of space intelligence that uses Beidou satellite navigation systems and ground stations to indicate precise positioning for smart cars, drones and mobile devices. Beidou is owned and administered by the National Space Administration of China.
Although in 2018, Alibaba took off from its 50% stake in Qianxun Intelligence, the appear its managers continue to control important participation, and Alibaba continues to depend on Qianxun AI for its commercial products.
The Department of Defense also noted that Alibaba partnered with the state-owned China Mobile company to build data centres for cloud computing and artificial intelligence. As Alibaba increasingly invests in these sectors, this partnership is likely to be further strengthened, as these technologies are largely dependent on geospatial data and technology centres, strategic sectors within the national security framework of the Chinese Government. Since 2026, Alibaba has incorporated into a new joint venture to build a power plant in the coastal city of Ningbo together with China National Nuclear Power Co., in order to ensure a stable supply of electricity for the needs of its future data centres. In addition, in September it acquired a participation in the state-owned company Shanghai Spacecom Satellite Technology to develop the Qianfan constellation (-), low Earth orbit broadband constellation similar to SpaceX Starlink for its geolocation products.
As a private company listed in US and Hong Kong stock exchanges, Alibaba is not under the supervision of SASAC. However, in technological competition between China and the United States, Alibaba's investments are inevitably directed towards strategic sectors that need to work with state-owned companies. The Department of Defence maintains that these links include an indirect affiliation with the supervision of State assets and the State Council's administrative commission, which is in line with China's civil-military fusion strategy.
In addition, some of the subsidiaries of Alibaba, such as Youku Film and Television (video transmission service) in Shanghai, and Guangzhou Lujiao Information Technology Co., Ltd, have "Gold shares" agreements with state-owned companies supported by the China Internet Investment Fund, created by the China Cyberspace Administration to strengthen the management at the level of the Alibaba content platforms board.
The Department of Defense points out that including high-level representatives of large Chinese technology companies - such as Alibaba, Baidu, Huawei and Tencent - in the Technical Committee for the Standardization of Artificial Intelligence of China, under the Ministry of Industry and Information Technology of China, is evidence of the direct links of Alibaba with the Chinese Government.
Based on the analysis of the Chinese Communist Party magazine, * Qiushi * (hd), and various Western observers from China, the Department of Defense's argument is that the investment and development of Alibaba are strategically aligned with the Chinese Government's policy, which includes the incorporation of artificial intelligence technology into its military team, the strategy of locating data centres in western regions, the construction of space computing infrastructure and more.
Moreover, not only are large technological companies such as Alibaba subject to government restrictions; the sudden cancellation of Chinese regulators from the acquisition of ManusChina's emerging company of artificial intelligence, from Facebook in early 2026, reflects China's fervor to protect and control its technology sector.
China's Technology Giant Governance Model
The current Chinese model of governance of large technology companies comes decades of experience in controlling stability to ensure the single party regime through censorship, surveillance, party consolidation and ideological control. While the development of the IA has generated concern in the West about automated crimes, such as the cyber attack with the IA and unemployment, China considers the IA simply as a tool that can be managed. For example, in response to the waves of runoff strikes against the pressure of the IA in recent years, along with the measures of repression and arrests, regulators also convened representatives of the main platforms, such as Jingdong, Meituan and Taobao, and ordered them to adjust their algorithms, eliminate late delivery fines, introduce rest times and encourage negotiations between workers and platforms.
Taobao, the national shopping platform of Alibaba, has so far established more than 300 party branches for 300,000 Taobao suppliers and, through these branches, offers job training, low-cost accommodation and meals for workers who need it, which is certainly a benefit for the working class.
In the ongoing judicial process, Alibaba refutes the Department of Defense's allegations, claims that the company complies with Chinese and American laws, and is administered by an independent board of directors without military affiliation. It also stresses that its main activity, including cloud services, e-commerce and logistics, is aimed at individual companies and consumers, rather than the military sector.
The case would test the US government's position on the governance model of large Chinese technology companies. Tencent and Baidu have not yet filed an appeal to be excluded from the Department of Defence's 1260H sanctions list.
