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Against Fake Goods
Cover Stories Series 2015> Against Fake Goods
UPDATED: February 9, 2015 NO. 7 FEBRUARY 12, 2015
A Reality Check for Alibaba

A report issued by the State Administration for Industry and Commerce (SAIC) on January 23 showed that Alibaba-owned Taobao.com, China's largest consumer-to-consumer platform, exhibited the worst performance of the six online shopping sites examined. A quality check conducted between August and October last year showed that only 37.25 percent of the sampled goods from the platform were authentic.

After the report was released, Taobao published an open letter on its official website, accusing the SAIC of violating relevant regulations, being too biased in enforcing the law and following inappropriate supervisory processes. Such accusations have resonated among the public.

Fake products are prevalent on e-commerce platforms both in China and abroad. The country has laws and regulations that expressly forbid the sale of fake goods and e-commerce websites also have their own supervision systems in place. Alibaba itself harshly penalizes vendors found to be selling fake goods online.

However, the nagging issue of fake products has remained unresolved on Taobao.com. Lax supervision on the part of the government and the e-commerce website in question may offer an explanation. Industry and commerce authorities, which are responsible for supervising the processes involved in online shopping, have failed to adequately enforce the regulations on punishing the selling of substandard and counterfeit goods. They often pass the buck when dealing with consumers' complaints.

Furthermore, owners of e-commerce platforms tend to put economic interests first. In order to keep online vendors happy, Taobao.com blocks customers from commenting on goods which have been returned owing to quality issues. One consumer who filed an application for return of the goods bought on Taobao.com was forced to solicit an assessment of the product within a mere 48 hours from a licensed third party. Such requirements are almost impossible to fulfill, given the tiny window of time allowed, the expense incurred and the inadequate availability of such assessors. Faced with these conditions, consumers more often than not find themselves left with no option but to relinquish their rights.

The SAIC report signals the beginning of tightened control over e-commerce platforms in China. Under pressure from consumers, Taobao.com has also promised to strengthen penalties for vendors selling unqualified products. It is hoped that the government and online shopping platforms can join hands to achieve substantial results in the new round of measures designed to crack down on fake products.

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