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Chinese Regulators to Target Sale of Counterfeit Goods Online

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Nearly one month after luxury goods giant Kering sued e-commerce behemoth Alibaba for carrying counterfeit products bearing the trademarked logos of Gucci, Balenciaga, Bottega Veneta and Saint Laurent, Chinese regulators are making moves to clean up the country’s e-commerce act.

The State Administration for Industry and Commerce (SAIC) on Thursday revealed plans to launch a five-month campaign targeting the online sale of fake and substandard goods. Dubbed Red Shield Net Sword, a statement on the SAIC’s website said the operation will run from July to November and seek to strengthen the regulation of e-commerce platforms as well as “promote the healthy and orderly development of the network market.”

The agency didn’t call out any e-commerce companies in its statement, but earlier this year it accused Alibaba of selling knockoffs on its biggest shopping platform, Taobao.com, and in 2011 the Commerce Department blacklisted the site as a “notorious market” linked to sales of pirated products. JD.com and Yihaodian have also come under fire for carrying counterfeit goods.

Now the SAIC is tightening control over the loosely regulated realm of Chinese e-tailing by suggesting that local departments strictly implement the supervision of trading platforms in order to “resolutely crackdown on Internet trademark infringement and selling counterfeit and shoddy goods and other illegal activities.”

The agency staged a similar campaign against counterfeits last year that resulted in the deletion of 36,000 listings, while 14,000 sites were required to rectify existing problems and 2,201 sites were shut down. In addition, 7,746 investigated cases were fined a total of 113 million yuan ($18.2 million).

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