Alibaba Rebukes U.S. Over Counterfeit Watchlist Inclusion

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Alibaba Group Holding Ltd. blamed politics for the fact that it is still on a U.S. government watchlist for counterfeit goods despite its efforts to fight fakes.

Alibaba’s “inclusion on its list is not an accurate representation of Alibaba’s results in protecting brands and IP, and we have no other choice but to conclude that this is a deeply flawed, biased and politicized process,” Alibaba Group President Michael Evans said in a statement.

Alibaba regularly touts achievements in fighting counterfeits. Brand partnerships, 24-hour turnarounds for removal requests, and a legal victory stopping the sale of fake cat food are among its examples.

Still, Alibaba again appeared on the Office of the U.S. Trade Representative’s 2017 annual report, released Jan. 12, which highlights markets reportedly linked to counterfeits. The USTR removed Alibaba from the list in 2012 but added it back in 2016. 

Among the USTR’s latest recommendations is that Alibaba ensure the criminal leads it gives to Chinese authorities result in “meaningful enforcement outcomes.”

Alibaba called that “patently absurd” in a point-by-point rebuttal of the report. The company’s leads have resulted in more than 1,000 arrests and the shutdown of about 1,000 manufacturing locations, Alibaba said.

“If USTR has a concern with the Chinese government, then it should raise the concern directly with the Chinese government,” Alibaba said in its rebuttal. “They should not use Alibaba as a pawn in their bilateral disputes.”

The report said Alibaba failed to provide data showing the scale of counterfeit goods on its consumer-to-consumer platform, Also, Alibaba appears to focus efforts on global brands rather than small and medium-sized businesses, it said.

Alibaba, in response, said it is “more transparent than any platform in the world” regarding counterfeits and has reported all its data to the USTR. It also said that new measures are “specifically tailored” to meet the needs of small and medium businesses.

In its 2016 report, the USTR made three recommendations for Alibaba: simplify processes for rightsholders; make its Good Faith takedown program generally available; and reduce takedown timelines.

Alibaba claimed that it has “dramatically exceeded” those recommendations. It provides a single email address for submitting takedown requests, participation in Good Faith has grown “significantly,” and 97 percent of takedown requests are handled within 24 hours, it said.

Alibaba spokesman Brion Tingler told Bloomberg Law the company hasn’t made a decision on whether to appeal the report. A USTR spokesperson didn’t immediately respond to a request for comment.