Taobao named on USTR’s 2016 Notorious Markets list
Alibaba Group’s online shopping website Taobao has been put on the US Trade Representative’s (USTR) Notorious Markets list for 2016.
Released yesterday, December 21, the list “highlights specific physical and online markets around the world that are reported to be engaging in and facilitating substantial copyright piracy and trademark counterfeiting”.
Taobao is an “important concern”, according to the list, because of the large volume of allegedly counterfeit and pirated goods available on the site and the challenges rights owners experience in removing and preventing sales of these goods.
However, other Alibaba sites were not listed.
The list said that Alibaba has “reportedly” taken steps to address concerns including by establishing internal offices focused on intellectual property rights, addressing the misuse of brand keywords and developing technology to prevent counterfeit sellers from re-opening.
“Alibaba claims it has proactively removed more than 380 million product listings and closed approximately 180,000 Taobao stores in the 12 months ending August 2016,” said the USTR.
Alibaba has also announced a shift from a four-strike to a three-strike policy and the launch of a joint force system, “intended to expand proactive enforcement efforts”.
Despite these efforts, the list said: “While recent steps set positive expectations for the future, current levels of reported counterfeiting and piracy are unacceptably high.”
Rights owners in the US and internationally “continue to report serious challenges to reducing high levels of counterfeit and pirated goods on Taobao”, the report added, while “longstanding obstacles to understanding and utilising basic IP enforcement procedures continue unabated”.
Some of these challenges include initial attempts to report IP infringement being refused inconsistently, denials of takedown requests containing little to no justification or guidance on how the rights owner may amend its notification to obtain results, and pertinent communications to rights owners not being translated from Chinese.
The USTR said that given the dominance of Chinese sellers on Alibaba’s platforms, “it is critical that the Chinese government support these efforts through measurable enforcement efforts across China and stronger domestic IPR reforms”.
In 2017, the US will closely monitor the implementation and effectiveness of the prospective actions described in Alibaba’s Notorious Markets list submission.
In a statement released by the USTR, Ambassador Michael Froman said: “Our Notorious Markets list highlights key examples of online and physical markets all over the world that are linked to significant infringement of American businesses’intellectual property rights.”
He added that the 2016 list “takes stock of emerging infringement models and adds stream-ripping sites and piracy apps to the list of the most damaging digital marketplaces”.
Michael Evans, president of Alibaba Group, questioned whether the USTR acted “based on the actual facts or was influenced by the current political climate”.
He said that the company was “very disappointed” by the decision as it is “far more effective and advanced in IPR protection” than when the USTR took Taobao off the list four years ago.
“The decision ignores the real work Alibaba has done to protect IP rights holders and assist law enforcement to bring counterfeiters to justice. The more than 100,000 brands that operate on Alibaba’s marketplaces cannot all be wrong—they are a clear demonstration of the trust that rights holders place in us,” said Evans.
