The focus of the investigation is on how the company stores the data of US customers, including personal information. Is he reaching out to the Chinese government? Following the investigation, US regulators may direct Alibaba to take measures to reduce the risks posed by its cloud business. In addition, citizens living in the US or outside the US may be barred from using Alibaba’s service.
However, Alibaba’s US-listed shares fell nearly 3 percent before the market opened on Tuesday. The company’s business declined by more than 1 percent. Former President Donald Trump’s commerce department was also concerned about Alibaba’s cloud business. However, after the Biden administration came to power, the work of reviewing Alibaba’s business has started.
According to research firm Gartner, Alibaba’s cloud business in the US is small. Its annual revenue is less than $ 50 million (about Rs 375 crore). But if US regulators decide to stop transactions between their country’s companies and Alibaba Cloud, it will hurt the company. Its image will also be shocked, because every country’s company wants to do business with American companies.
A commerce department spokesperson declined to comment on the matter. The Chinese embassy in Washington also did not respond to a request for comment. Alibaba also did not say anything, but the company’s annual report talks about similar concerns.
Alibaba’s cloud business is being investigated by a small office in the Commerce Department. This is known as Intelligence and Security. It was formed by the Trump administration, whose purpose is to investigate transactions between American companies from countries such as China, Russia, Cuba, Iran, North Korea and Venezuela.
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