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USTR Warns Alibaba About Fakes

U.S. trade officials are keeping an eye on Alibaba.

Despite strong efforts by the American Apparel & Footwear Association (AAFA) to have the Chinese e-commerce company’s Taobao marketplace re-listed as a “notorious” website for selling counterfeit clothing, shoes and handbags, it’s managed to stay off the U.S. Trade Representative’s (USTR) annual blacklist.

But the federal agency on Thursday advised Alibaba to step up its anti-counterfeit efforts and cooperate with the apparel and footwear industry to address ongoing piracy complaints. It will also continue to monitor the situation in the coming year for signs of improvement.

“Brand owners continue to report that Alibaba platforms, particularly Taobao, are used to sell large quantities of counterfeit goods,” USTR said in a report on fake goods in global markets, adding that it’s “increasingly concerned…that Alibaba Group’s enforcement program is too slow, difficult to use and lacks transparency.” was removed from the USTR blacklist in 2011 while Taobao was taken off the following year, under the condition that it would improve its anti-piracy practices. But several groups, including the AAFA, have said that counterfeit goods are still rampant on the company’s websites.

“AAFA strongly complained about the volume of counterfeits on the Alibaba sites and has repeatedly called for Alibaba to come up with a new system to take down counterfeits. It’s clear in this report that USTR shares these concerns,” Juanita Duggan, president and CEO of AAFA, said. “After years of trying to work with Alibaba, we got nowhere. Every signal we received was that they were unwilling or unable to make reforms.”

In July, the AAFA wrote a letter to Jack Ma, Alibaba’s executive chairman, asking for his cooperation in developing new, transparent and easy-to-use takedown procedures. The group said it received no response.

Duggan added, “We hope Alibaba responds to this report and uses its position as one of the largest technology companies in the world to lead the way and eradicate counterfeits from its sites. We hope Alibaba chooses to become a market of integrity.”