Alibaba agrees to pay US$600 million to settle US probe into illegal product sales

Alibaba Group will pay US$600 million to settle a US Department of Justice investigation into allegations that its e-commerce platforms enabled the sale of thousands of illegal pharmaceuticals, controlled substances, and other prohibited products into the United States, marking one of the largest criminal resolutions involving a Chinese technology company.

The settlement, announced on Wednesday, resolves the investigation through non-prosecution agreements with Alibaba and AUS Merchant Services, formerly known as Alipay US and now a subsidiary of Ant Group. While the companies avoided criminal prosecution, they accepted responsibility for the conduct described by the Justice Department and agreed to strengthen their compliance programmes.

In a statement to the South China Morning Post, an Alibaba spokesperson said the company had reached “a mutually satisfactory resolution” with US regulators over compliance involving third-party merchants selling products into the United States.

According to the Department of Justice, Alibaba admitted that between 2016 and 2024, merchants using Alibaba.com and AliExpress conducted about 80,000 transactions involving illegal imports into the United States, including pharmaceuticals, controlled substances, precursor chemicals and equipment used to manufacture counterfeit drugs.