According to two sources familiar with the matter at hand, the U.S. State Department has submitted a proposal to the Trump administration to add China’s Ant Group to its Entity List.

The development comes at a time when when the Trump Administration aims to deter U.S. investors from taking part in the initial public offering (IPO) of the Chinese company.

Although currently, the Ant group’s Alipay payment app is not available to American users, according to the company’s spokesperson, the Trump administration aim to block access to sensitive banking data to future potential U.S. consumers.

So far the Trump Administration has not used hardcore tools against China, including the freezing of assets in the United States, which many attribute to Treasury Secretary Steve Mnuchin’s dovish stance on Beijing.

U.S. Senator Marco Rubio, has successfully urged the Trump administration to pursue investigations of Chinese companies, which could potentially delay the Ant Group’s U.S. IPO.

The Hong Kong leg of the IPO is being sponsored by China International Capital Corp, Citigroup, JPMorgan and Morgan Stanley. Credit Suisse is working as a joint global coordinator. Goldman Sachs is also involved.

There have also been media reports of China’s securities regulator probing a potential conflict of interest in Ant Group’s planned stock listing.

“Is there a conflict of interest? Clearly there is,” said Peter Alexander, the managing director at Z-Ben, a Shanghai-based consultancy, of Ant’s arrangement with the fund managers. “From an ethical standpoint you’re using your own platform to raise money from your clients to invest in your own company.”

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