Apple (AAPL) is facing scrutiny from the White House and congressional officials over its plan to use Alibaba Group Holding's (BABA) artificial intelligence technology on iPhones in China, The New York Times reported Saturday, citing three people familiar with the matter.

US authorities are concerned over the deal potentially assisting a Chinese company improve its AI abilities and expand the reach of Chinese chatbots with censorship curbs, among other things, according to the report.

Officials at the White House and the House Select Committee on China have raised the concerns directly with executives at Apple, the unnamed sources told the publication.

Apple, Alibaba, and the White House did not immediately respond to MT Newswires' requests for comments.

Apple shares were down 1.5% in recent premarket activity Monday, while Alibaba fell 1.9%.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)