TL;DRAlibaba lost five lobbying firms and Tencent four as a Pentagon rule bars defense work for firms that also lobby for blacklisted Chinese companies.
Washington lobbying firms have been quietly dropping Alibaba and Tencent as clients ahead of a new Pentagon rule that takes effect on Tuesday. According to Bloomberg, Alibaba has lost five lobbying firms and Tencent has lost four since the Defense Department expanded its list of Chinese military companies earlier this month. The departures leave two of China’s biggest technology conglomerates without their primary advocates in the US capital at a time when they face escalating pressure on multiple fronts.
The rule in question is Section 851 of the fiscal 2025 National Defense Authorization Act, which bars the Defense Department from contracting with any company that also employs a registered lobbyist for an entity on the Pentagon’s 1260H Chinese military companies list. The provision forces lobbying firms to choose between their defense clients and their Chinese ones. For most firms, the calculation is straightforward: defense work pays more and carries less political risk.
Bloomberg reported that Brownstein Hyatt Farber Schreck and Mercury Public Affairs both dropped Alibaba, while MO Strategies also ended its relationship with the company. Rob Kelner, a partner at Covington & Burling, told Bloomberg that some firms had terminated their Chinese clients even before the law was signed as a precaution. Kit Conklin, a former Trump White House aide now at a lobbying firm, said the exodus picked up speed after the Pentagon added 65 new entities to the 1260H list on June 8.
