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Alibaba hits back at US over market blacklist

The Chinese e-commerce giant, blacklisted over its problem with fakes, called this the result of a “deeply flawed, biased and politicised process.”

Alibaba Generated Over USD 25.3 Billion During Singles' Day

Jack Ma, Alibaba's founder, has urged the Chinese government to crack down on counterfeiters on more than one occasion.

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The Office of the US Trade Representative has blacklisted Alibaba's popular online shopping platform again this year over its problem with fake goods. And Alibaba is not happy.

The Chinese e-commerce titan published a point-by-point rebuttal in response to the US Trade Representative's 2017 list of notorious markets released Friday, on which its eBay-like Taobao platform is listed for the second consecutive year.

China has long had a problem with counterfeit goods, with the Organisation for Economic Co-operation and Development saying that over half of the world's fake goods originate from the country, including fake baby formula, muttoneggs and whiskey. Alibaba's Taobao is also accused of housing counterfeiters, but the company has been trying to rid the public of the belief that its platforms are saturated with counterfeits for "many years." Its efforts helped take it off the blacklist for four years in 2012, according to the rebuttal.

Alibaba's founder, Jack Ma, has also publicly urged the Chinese government more than once to mete out harsher penalties upon counterfeiters. In a Weibo post addressed to Chinese lawmakers at a high-level meeting in March, Ma called for counterfeiters to be punished like drunk drivers. The letter came a month after he wrote a public appeal to the government criticising its ambiguous counterfeiting rules and saying his company a victim of fake goods too.

While the USTR commended Alibaba's efforts in fighting fakes on its platform -- including simplifying the processes for takedown requests, being more proactive in removing suspected vendors selling counterfeits and providing leads to Chinese law enforcement that resulted in arrests and facility closures -- it added that "important unresolved concerns remain."

"The data provided by Alibaba to date do not directly reflect the scope and status of the counterfeiting problem on the platform, but instead is merely suggestive of progress made," USTR wrote in its report.

Alibaba Group President Michael Evans disagrees, saying it is "more transparent than any platform in the world" in talking about the presence of fake goods on its platforms. He also refuted USTR's observation that Alibaba's efforts appeared to be more directed at helping global brands than small and medium enterprises. 

Evans added that the authority is "not actually interested in seeing tangible results" no matter how much effort the company puts in and how much progress they have made. He continued that the platform getting blacklisted again has driven the company to conclude that this is the result of a "deeply flawed, biased and politicised process" which reflects the USTR's "disregard" for its efforts.

A spokesperson from Alibaba sent this response to CNET's request for comment:

"As a result of the rise of trade protectionism, Alibaba has been turned into a scapegoat by the USTR to win points in a highly politicized environment and their actions should be recognized for what they are. The USTR's actions made it clear that the Notorious Markets List, which only targets non-US marketplaces, is not about intellectual property protection, but just another instrument to achieve the US Government's geopolitical objectives. Alibaba reiterates our point of view: we will continue to strengthen our IP protection system with world leading technology and a collaborative approach with brands and other stakeholders. Our efforts and results speak for themselves: over 100,000 brands, including 75 percent of the world's most valuable consumer brands, do business on our platform."

Update, 10:34 a.m. GMT: Adds response from Alibaba.

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