BEIJING, July 3 (Reuters) – Chinese tech giant Alibaba has banned employees from using Anthropic’s Claude Code at work after the tool drew scrutiny for features that can help identify China-linked users, according to a person familiar with the order.
The ban is part of a deepening spat between the two companies after Anthropic accused Alibaba of illicitly extracting its Claude AI model capabilities — a dispute that highlights the frantic race between the U.S. and China to take the lead in artificial intelligence.
Claude Code is Anthropic’s AI coding assistant for software developers. It has become popular among programmers in China despite Anthropic’s restrictions on access by users and entities in China.
The person, who was not authorised to speak to media and declined to be identified, said that Alibaba employees were being told to use the company’s own coding platform Qoder.
Alibaba and Anthropic did not immediately respond to Reuters requests for comment. Alibaba has not publicly commented to date on Anthropic’s accusations.
ANTHROPIC ACCUSES ALIBABA OF DISTILLATION STRIKE
Anthropic said last month that it had suffered a strike by Alibaba, which it described as a “distillation” effort that involves training a less capable model on the outputs of a stronger one.
The distillation helps accelerate China’s ability to reach Anthropic’s advanced Mythos Preview capabilities, it said in a letter seen by Reuters that was sent to two U.S. senators.
Alibaba’s ban comes just days after developers said Claude Code contained mechanisms that inspected user environments, including timezone and proxy-related information, and inserted subtle markers into prompts sent to Anthropic’s servers.
An Anthropic employee wrote on Tuesday on X that the feature was “an experiment we launched in March” intended to prevent account abuse by unauthorized resellers and protect against model distillation.
The person who spoke to Reuters about Alibaba’s ban said that Anthropic’s restrictions targeting China were difficult to enforce on individual users who can deploy servers in the United States and make traffic appear as if it originated there.
But companies were more aware of legal and compliance risks, the person added.
As U.S. AI model developers seek to prevent unauthorised access, resale and distillation of their systems, Chinese cloud and AI firms have shifted toward domestic and open-source models such as DeepSeek, Alibaba’s Qwen, Moonshot and Zhipu.
At the same time, Chinese AI models are making inroads in the U.S. market — a development that sparked concern among some U.S. industry experts.
Alibaba’s ban was first reported by Chinese media outlets.
(Reporting by Eduardo Baptista; Editing by Edwina Gibbs)
Copyright 2026 Thomson Reuters.