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8 September 2021TrademarksMuireann Bolger

China aims to tighten laws against online counterfeiters

China has unveiled proposed revisions to its e-commerce law in a bid to crackdown on online counterfeit products as the country’s digital economy continues to flourish.

The country’s top regulator, the State Administration for Market Regulation (SAMR), released the draft amendment for public consultation promising tough penalties for individuals and companies found selling fake products online.

The draft outlines detailed rules and the proposed additional punishments including the potential revocation of online business licences, and was first reported by the South China Morning Post.

It also extends the response window in which an operator’s merchant’s business can be restricted while IP disputes are investigated and resolved from 15 working days to 20.

The move, announced on Tuesday, August 31, comes as the country tightens regulation on its digital economy as part of its efforts to tackle China’s infamy as the main global source of counterfeit merchandise.

Tougher sanctions

In June, WIPR spoke with WIPR Trademarks Live guest Jenna Curtis, director of brand programmes at Corsearch, to discuss how exactly brands should adapt their protection approach when fighting against counterfeiting in China.

If passed, this latest proposed revision will update the country’s existing 2019 e-commerce law covering the requirement for registration and licensing of e-commerce operators, taxation, electronic payments and e-commerce dispute resolution, as well as the protection of IP.

According to the law, e-commerce operators can face penalties of up to 2 million yuan (US$309,400) if found liable for IP infringements. Before the law went into effect in 2019, online merchants were only liable when caught selling fake products.

In April, SAMR hit Chinese retail giant Alibaba with a$2.8 billion fine after an investigation determined that it had abused its market position for years.

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10 June 2021   As China continues down the path of globalisation, laws protecting IP have been playing catch up.