China e-Commerce Conglomerate Alibaba Reportedly Restricts Operations in Russia - True or False

Alibaba, the business-to-business (B2B) equivalent of the business-to-consumer (B2C) e-commerce platform AliExpress, reportedly no longer accepts payment in Russian rubles and would cease deliveries to Russia. But is that true?

Both Alibaba and AliExpress belong to the Alibaba Group Holding Limited, but AliExpress’s social media page confirmed the restrictions do not apply to AliExpress.

Sources in the market confirmed to Russian news outlet Kommersant that payments on Alibaba from Russian cards no longer go through – albeit with some exceptions – though they expected the funds to be returned in the near future.

However, at the time of publication, Alibaba’s site in Russia continues to function and shows the prices in Russian rubles, where the country continues to be listed among the delivery addresses while viewing available merchandise.

Russian economics expert Semyon Novoprudsky told Kommersant that fear of secondary US sanctions is likely to blame for Alibaba’s operation restrictions.

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A popular platform for Russian businesses, Alibaba’s operation restrictions in Russia are likely to further restrict Russia’s access to foreign goods, where China remains one of the few countries not imposing sanctions against Russia.

“Alibaba is a favorite source of goods for many so-called resellers: these are wholesale markets, stores, sellers on marketplaces.

“It is obvious that the same times have now come for these players as for larger economic counterparties, who have already been living under sanctions for more than two years and are learning to circumvent them in every possible way,” market expert Artem Bobtsov told Kommersant.

Bobtsov added that Russian buyers could likely circumvent the issue by purchasing through entitles in neighboring nations such as Kazakhstan and Armenia, though it would also incur additional costs.

The restrictions might also affect the Russian military, where Kyiv Post reported in November 2023 that Moscow’s Ministry of Defense procured thousands of Chinese offroad vehicles for its war in Ukraine, potentially through wholesaler platforms such as Alibaba.

FACT-CHECKING

Some media reported that AliExpress, not Alibaba, introduced the restrictions. However, AliExpress announced on its social media page its operations in Russia will continue as usual, even reminding Russians that a sale is due to start on June 1.

“Friends, news has appeared in the media about our colleagues from Alibaba. Some people confuse AliExpress and Alibaba, so we want to reassure you that all payments and delivery from AliExpress are working as usual.

“PS And on June 1st the sale also starts,” read the company’s update on Russian social media VKontakte.