Chinese e-commerce company Alibaba has issued a company-wide ban on Anthropic's AI development tool "Claude Code," citing security risks. While Anthropic's AI models are in principle unavailable for commercial use in China, the move appears to be a response to problems that surfaced as access through workarounds recently increased.
On Wednesday, Chinese IT-focused outlet Zhidongxi, citing an Alibaba insider, reported that "security risks recently emerged indicating that a backdoor — a secret channel that bypasses normal security mechanisms to allow unauthorized system access — was embedded in Claude Code." The outlet said, "Alibaba added it to the list of high-risk software after a comprehensive evaluation."
The outlet further reported that Alibaba will fully ban internal employees from using Claude Code in the work environment starting July 10, and has decided to recommend Alibaba's "Qoder" as an alternative solution. Alibaba also required employees to delete all of Anthropic's AI model series, including Sonnet, Opus and Fable.
Alibaba had supported subscription fees for external models such as Anthropic's Claude, OpenAI's GPT and Google's Gemini to encourage employees' use of AI technology, and thanks to the company's subsidy, a considerable number of Alibaba developers used hundreds of dollars' worth of tokens each week.
The reason Alibaba, which had encouraged the use of U.S. AI, suddenly changed its stance appears to be a letter Anthropic sent to the U.S. Senate Banking Committee on the 10th of last month. Anthropic claimed that Alibaba used about 25,000 fake accounts between April 22 and June 5 to exchange more than 28 million conversations with Claude, and that such conduct was a "distillation" attack that steals Anthropic's AI models without authorization. Distillation is a technique in which a developer uses the outputs of another AI model to train its own system, achieving similar performance at much lower cost.
Anthropic subsequently carried out large-scale restrictions on Claude accounts between late last month and early this month, and numerous Chinese users were blocked without prior notice. The Financial Times (FT) reported Tuesday that despite the United States' strict export controls and service restrictions, Chinese engineers are accessing the latest U.S. AI technology using various methods. Workaround access does not violate U.S. or Chinese law, but it does breach Anthropic's terms of service, which prohibit model use by Chinese companies and their overseas affiliates.
Chinese fintech giant Ant Group recently created corporate accounts for Anthropic's Claude under the names of affiliates established overseas, such as in Singapore, and supported access for employees at its Chinese headquarters, according to reports. It allowed Ant Group employees to access corporate Claude accounts through an internal intranet connected to its Singapore subsidiary. Chinese companies have also been known to access AI tools such as Anthropic's "Claude Code" through cloud services including Microsoft's (MS) Azure. MS sold application programming interface (API) access rights to Singapore-based Chinese companies, through which engineers at Chinese headquarters can use Claude via their internal network. One source told the FT, "Accessing Claude through overseas affiliates is an already-known issue, not something limited to specific companies."
Anthropic announced a strong response, saying it is continuously updating its tools to detect and sanction Chinese users as they develop new workaround techniques. Anthropic monitors detailed metrics such as the usage time zone of the computer a user connects from, and also analyzes factors such as the country where the payment credit card was issued, thereby detecting and blocking fake accounts that have U.S. IP addresses but actually connect from China.
Anthropic stated, "We explicitly prohibit accessing or facilitating access to Claude Code from unsupported regions, including China," adding, "We are the only frontier AI company that restricts service to companies owned by Chinese entities, even subsidiaries established outside China."
