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Mobile apps provided by Alibaba Group Holding Ltd The (NYSE: BABA)-backed Ant Group will be banned under an executive order issued Tuesday by outgoing President Donald Trump.
What happened: U.S. transactions with the Hangzhou, China-based Ant Group, which had more than 1.2 billion users worldwide as of October 2019 according to Xinhua, will be banned.
The order will not come into effect until after Trump leaves, as it is expected to be applicable in 45 days.
Applications offered by Tencent Holdings Ltd (OTC: TCEHY) such as Tencent QQ and WeChatPay were also banned under the order, alongside CamScanner, SHAREit, VMate, and WPS Office.
The order highlighted threats posed by Chinese apps, which could allow the Asian power to track the location of federal employees and contractors and “build records of personal information.”
Why is this important: Trump’s move is the latest setback for Alibaba, founded by Jack Ma, which also faces an antitrust investigation in China.
See also: Chinese Financial Regulators Order Ant Group to ‘Review’ Its Business
Last August, Trump signed an executive order to ban ByteDance TikTok’s short video app unless its parent company agrees to sell the app.
A federal judge later ordered an end to the TikTok ban the following month.
Oracle Corp (NASDAQ: ORCL) and Walmart Inc (NYSE: WMT) agreed to purchase TikTok, ahead of court-granted relief.
According to the latest reports, Ant Group could be forced to sell part of its stock portfolio. Chinese regulators are also considering asking fintech to share consumer data, according to a Wall Street Journal report released on Tuesday.
Price action: Alibaba shares traded 2.08% lower to $ 235.40 on Tuesday after the close after closing nearly 5.5% higher at $ 240.40.
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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