One of the biggest problems that the American public has when purchasing products made in China, is counterfeit merchandise and consumer product law infringement. Due to the limitation of copyright laws and enforcement of them when it comes to products that are international exports, counterfeits are rampant. In an attempt to crack down on fakes being sold as genuine, websites like Alibaba are publicly asking for tougher laws and for help from the Chinese government in upholding those laws.
The Chinese-based e-commerce company has demanded a crackdown on the counterfeits that are being sold on their site and that legal cases be built as a deterrent to others. To date, Chinese laws don’t do much to build legal cases against counterfeiters, and even when charges are brought they have very low conviction rates. To say that the government does not have a record of dealing harshly with counterfeiters would be an understatement.
Alibaba representatives are frustrated by their inability to strengthen the credibility of the merchandise offered on their site, because they have been hitting road blocks and are receiving very little help from the Chinese government. That has decreased consumer confidence in the site. Even those who are trying to sell real merchandise aren’t able to, because there is already a presumption that if the merchandise is made in China, it is automatically fake.
Brand owners in the US have had major problems with Alibaba in the past. Fostering an atmosphere of knock-offs being sold for a fraction of the price, counterfeit products are flooding the market and defective products lawsuits are mounting. That only devalues name brands and decreases their sales. For many buyers, if the knock-offs are good enough that no one can tell the difference, then why should anyone spend the money on something real? Independent vendors on Alibaba, which boasts over $1.5 billion in product sales, have been called out as some of worst offenders of intellectual and property rights when compared to others around the globe.
Alibaba, however, has portrayed their company as doing everything they can to curb counterfeit merchandise being sold to their consumer base. In public statements issued to save face, although they have done very little to shut down vendors who are egregiously infringing on property rights laws, they insist that they have in fact done everything possible.
Alibaba insists that they regularly go through listings to ensure that the merchandise is real, and that they flag vendors they believe are breaking the law. Also, they maintain that when they find counterfeits, they always report them to the Chinese authorities. Because of that, they believe that they have done all they can to stop the practice of counterfeit merchandise being sold on their e-commerce site.
Alibaba’s problem is that while they are saying that they are doing everything possible to stop the flow of knock-offs, chairman Jack Ma is publicly praising the quality of the fake merchandise being sold. Not only is the site profiting from counterfeit products, but they are also praising how good vendors have gotten at reproducing the real thing — so much so that fakes can no longer be distinguished from real. In sending this mixed signal to the consumer, they are saying one thing while fostering another.
Ma insists that he made his statement not to signal to people that knockoffs were good to invest in, but to explain that it is becoming harder and harder to tell the genuine articles from the fake. He maintains that is the real problem posed for even Chinese e-commerce companies: to be able to decipher the counterfeits from real merchandise themselves.
Many brand names have brought suit against the site for product registering infringement, which is likely why Alibaba is now appealing to their audience and the Chinese government and portraying themselves as the poor middleman with their hands tied. The truth is that people who buy from the site know that what they are buying isn’t real, yet they continue to increase their purchasing numbers. It is difficult to tackle counterfeiting when it is such a profitable practice.
It’s likely the only way to put a stop to counterfeits being sold online is to have stricter laws governing imports from China. The reality is that the Chinese government isn’t very concerned with product laws, and until the US government puts a stop to continual ripping-off of American goods, it is going to continue indefinitely.