Alibaba is once again in trouble in the U.S. for allegedly selling counterfeit goods. Alibaba’s online platform Taobao has been included on the “notorious markets” list again after being removed four years ago. Alibaba’s Taobao is used to sell “high levels” of fake goods, claim U.S. authorities.
Counterfeiting and piracy are unacceptably high
A USTR (United States Trade Representative) report stated that rights holders in the U.S. and elsewhere continue to report serious challenges in reducing the high levels of counterfeit and pirated goods on Taobao. The USTR’s Notorious Markets list had 20 websites on it already, most of which offer streaming services.
The USTR’s Michael Froman said, “Tens of millions of American jobs and several trillion dollars of our gross domestic product rely on American creative and innovative industries. The marketplaces, tactics, and schemes that undermine and threaten America’s creative industries change quickly and require our constant attention.”
Froman added that the USTR’s Notorious Markets List includes those online and physical markets that are guilty of significant infringement on American businesses’ intellectual property rights. The USTR admitted that Alibaba had made some efforts to counter sales of fakes, indicating a brighter future but added that the current levels of “counterfeiting and piracy are unacceptably high.”
Is Alibaba back on the list because of Trump?
Alibaba, however, rejects the allegations, insisting that it has substantially improved the policing of its marketplaces, says the BBC. Also the firm said the “current political climate” in the U.S. could have put it back onto the list. Alibaba has been accused several times by U.S. President-elect Donald Trump of stealing intellectual property.
Alibaba Group President Michael Evans said the decision by U.S. authorities has left him disappointed. He questioned if it was “based on actual facts or was influenced by the current political climate.”
For a long time, the Chinese online retailer and its marketplace Taobao have been accused of being a platform for counterfeit goods. Earlier this year, Taobao said it has tighter controls on luxury goods sales, and sellers are now required to show proof of authenticity.
In May, however, the International Anti Counterfeiting Coalition (IACC) watchdog group suspended Alibaba for piracy concerns. Some members, including Gucci America and Michael Kors, had threatened to leave the IACC in protest, notes the BBC.
Alibaba, China’s biggest online retailer, was floated on the New York Stock Exchange in September 2014 and broke records by raising $25 billion.
On Wednesday, Alibaba shares closed down 0.66% at $89.25. Year to date, the stock is up almost 10%, while in the last six months, it is up almost 14%.