China's Alibaba will ban employees from using Anthropic's programming tool Claude Code starting on July 10. Anthropic already prohibits Chinese companies, as well as foreign entities owned by those companies, from using its models. The company has been working to close loopholes that allow Chinese users to access Claude. According to a recent Reddit post, some of the loophole-closing involved a version of Claude Code that could secretly identify Chinese users.

Anthropic's Thariq Shihipar mentioned in a post on X that the experiment launched in March was intended to prevent account abuse from unauthorized resellers and protect against distillation. Distillation is a practice where AI models are trained on the outputs of other models. Shihipar noted the team has implemented stronger mitigations since then and had planned to remove the feature for a while.

Despite these efforts, Alibaba has classified Claude Code as high-risk software and is directing employees to use the company's Qoder tool instead.