A US federal judge on Monday granted Alibaba Group Holding's request for a preliminary injunction, ordering the US government not to deny Pentagon contracts to companies because they, their parent companies or subsidiaries do business with firms that engage in lobbying activities for the e-commerce giant, Reuters reported.

Source: Reuters via BusinessWorld

Alibaba sued the US government in June after the Pentagon added it to a list of companies allegedly aiding China's military, alongside internet search provider Baidu, electric-vehicle maker BYD and other major Chinese manufacturing and technology firms, Reuters reported. BusinessDay, reporting the same ruling, said the injunction halts enforcement of the contract restriction while the challenge continues.

Source: BusinessDay

What the ruling does — and does not do

Monday's ruling means Alibaba will be able to retain US lobbyists who also represent Pentagon contractors, removing a potential obstacle to the company's efforts to challenge its designation as a Chinese military company, Reuters reported. The injunction does not remove Alibaba from the Pentagon list, which the company is continuing to challenge in court.

The designation does not impose formal sanctions, but it restricts Pentagon contracts with listed companies and, from 2027, purchases of their products or services through third parties, Reuters reported.

Alibaba denies any military ties

Alibaba has denied any military ties, saying its products and services are built for retail, logistics and enterprise technology rather than defence or intelligence. "The determinations have no basis in fact or law," Alibaba said in its lawsuit in June, seeking its removal from the list, Reuters reported.

Alibaba did not immediately respond to a request for comment on the injunction, Reuters reported. The case is another pressure point in the wider US-China technology rivalry, in which the Pentagon's list covers companies across e-commerce, search, electric vehicles and other strategic sectors.