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China's Alibaba bans Anthropic AI for employees after 'distillation attack' accusation

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Alibaba will ban employees from using Anthropic 's artificial intelligence tools for work purposes as of July 10, citing concerns that the U.S. company has back-door security risks, CNBC confirmed on Monday.

The Chinese e-commerce giant has put Anthropic's Claude Code on a high-risk software list, according to people familiar with the matter, who asked not to be named in order to discuss internal operations.

Alibaba's move follows Anthropic's decision in June to send a letter to the U.S. Senate Committee on Banking, Housing, and Urban Affairs, blaming the Chinese tech titan of "brazenly" and "illicitly" attempting to extract its AI capabilities. Anthropic accused Alibaba of carrying out "the largest known distillation attack" on it to date.

Anthropic's terms of service dictate that Chinese companies and other "adversarial nations" are banned from using its models.

Alibaba employees are required to uninstall all Anthropic models and agent products and instead use the Chinese company's own AI assistant, Qoder, the people said.

Alibaba and Anthropic both declined to comment.