China’s Alibaba shuts down 240k ‘shops’ for selling fakes

China’s biggest e-commerce company Alibaba has reportedly shut down over 240,000 online shops for selling counterfeit products from designer bags to fake wines on its platform in 2017, expanding its effort to combat counterfeit problem on its online marketplace.

Speakers at Alibaba’s second Anti-Counterfeit Alliance meeting in Guangzhou, China

At the second annual meeting of Alibaba’s Anti-Counterfeit Alliance meeting held in Guangzhou yesterday, its company executive Yao Yunren praised its anti-counterfeit efforts over the past year, and revealed its members in the alliance has risen from inaugural year’s 20 to 30, with more hopefuls including Australia’s wine giant Treasury Wine Estates (TWE) apparently eager to join.

“Close collaboration and engagement with our partners in the online marketplace is extremely crucial for brand owners to undertake IP protection activities. And we feel very honoured to have Alibaba’s strong support, which underpins the success of our very first online-to-offline case in China,” said Anna Gibson, director of Intellectual Property at TWE, to dbHK.

“We hope that our experience will motivate other luxury brand owners to collaborate in a similar way for success, and in the meantime we sincerely look forward to joining Alibaba Anti-counterfeiting Alliance (AACA) to further our cooperation on a multi-dimensional basis,” she continued.

TWE, the parent company of popular brands such as Penfolds and Wolf Blass, was among the most vocal wine companies that filed complaints to Alibaba over fake Penfolds sold on its platform. Earlier last year, TWE’s complaint has led police in Shanghai to uncover 14,000 bottles of Penfolds destined to be sold on Taobao as well as pubs and karaoke bars. 

Despite Alibaba’s seemingly strong resolve to stamp out counterfeit goods, the global leading company’s fast rise over the years from the start has been intertwined with reports of fake goods. In 2016, just weeks after joining the International Anti-Counterfeiting Coalition’s (IACC), Alibaba was suspended of its membership after other members including Michael Kors and Gucci quit in protest. 

A search of “fake wine bottles” on Alibaba would still generate close to 600 results

And a search of “fake wine bottles” by dhHK today on its website would still generate close to 600 results.

Alibaba’s Anti-Counterfeit Alliance meeting also came just days after the US Trade Representative put Taobao back on its blacklist over suspected counterfeit goods sold online for the second time, wrote Fortune.

In its report, the trade office wrote, the marketplace is of, “concern due to the large volume of allegedly counterfeit and pirated goods available.”

However, writing to refute the decision, Alibaba Group’s president Michael Evans said in a statement, “Alibaba is doing more to protect brands and rights holders than any e-commerce company in the world,” and “the number of takedown requests declined by 25% YoY [ year-on-year] as a direct result of our ability to remove infringing listings before they make it to our marketplaces.”

Offline, the company said it is also working with law enforcement to take down fake goods manufacturers. The company said it provided leads to law enforcement that resulted in over 1,000 arrests and the closure of nearly 1,000 offline manufacturing and distribution locations.