Alibaba’s new policy – home run or strikeout?

I've long since learned to take any statement from a Chinese marketplace declaring that they're taking additional steps to fight counterfeiting with a hefty pinch of salt and a sceptically raised eyebrow.

My experience has generally been that these "improvements" consist of introducing an additional layer of effort for the brand owner rather than simplifying the process and making it less burdensome for them in the way that eBay has managed with its VeRO program.

My  response to Alibaba's rolling out of a three-strikes policy[1] last month was, therefore, somewhat muted.

Their policy runs the following course:

  • First strike - warning letter sent to merchant

  • Second strike - merchant is prohibited from listing new products for 7 days. Current products offered are blocked from being returned by search queries for 7 days

  • Third strike - merchant is shut down and banned from the site.

In order for individual reports to be considered as separate strikes there must be a period of at least 5 working days between the first and second notice and 7 working days between the second and third. The policy will also only apply to items that can be identified as being counterfeit (rather than listings featuring an unauthorised use of an established brand's trademark to draw traffic to their own wares)

One major headache of the Alibaba system is that, unlike eBay where you can simply say "I have a good faith belief that this item is counterfeit", you have to detail the exact indicators that mark out the item being sold as counterfeit (e.g. "the care label on this jacket uses the wrong font" or "the thread used in the stitching of this handbag is the wrong colour"). Given the number of suspicious products being sold there, you can imagine how quickly the time required to report individual listings with this level of detail adds up.

Then there are the sellers who know full well how to disguise the fact that they're offering counterfeit goods and whose listings therefore feature nothing at which you can point and cry "BEHOLD! A FAKE!” These sellers may still be listing goods where the price is less than 1% of the RRP of a genuine item and where they claim to be able to supply 1 million units per month. Under the "good faith belief" argument, brand owners should surely be able to point these out as being counterfeit? Sadly, that's not a view shared by Alibaba.

So, a policy somewhat limited in scope but still the best effort we've seen from them so far to fight recidivism.

And that's quite sad in itself.

Angharad Baber, Enforcement Operations Manager