Trade officials of the United States issued a warning to China-based Alibaba Group Holding again, as complaints continue to come in from brand owners regarding the proliferation of counterfeit goods on the e-commerce giant's online sales websites.
A report released by the U.S. Trade Representative on the topic of piracy in the global markets said that Alibaba should increase its efforts in working with companies to prevent the further selling of fake products in its platforms such as Taobao, which is the company's wide-reaching online bazaar.
"Brand owners continue to report that Alibaba platforms, particularly Taobao, are used to sell large quantities of counterfeit goods," said the report.
The report also noted that brand owners are still continuing to issue complaints even after the Chinese e-commerce giant implemented initiatives to eliminate fake products on its platforms. According to the brand owners, the enforcement program of Alibaba is too slow and hard to use. It also lacks in transparency.
While the U.S. Trade Representative said that Alibaba will not be added to its list of notorious markets for counterfeit products, the agency is urging the company to improve its cooperation with its stakeholders to be able to address the current piracy complaints.
Alibaba responded that the company has a commitment to fight the sale of counterfeit products, adding that it is doing everything that it could to address the issue.
The report released by the U.S. Trade Representative is the second time that Alibaba has been warned regarding the sale of fake products on its online platforms. The agency took down Taobao from the list of piracy markets in 2012, when it cited the e-commerce giant's initiatives to fight against counterfeit goods.
If Alibaba will find itself on the list of notorious markets for piracy, the company's reputation in the United States could face damages, as its shares are now listed on the New York Stock Exchange. The company is still forging business relationships with entertainment companies and retailers, which would be put in jeopardy if Alibaba does not address the piracy issue soon.
Alibaba is the biggest e-commerce company in the world in some aspects, with 386 million active customers on its websites for the financial year that ended Sept. 30.
