WASHINGTON — The American Apparel & Footwear Association is turning up the pressure on Alibaba once again, calling for changes, more disclosure and “verifiable” results from the Chinese Internet giant’s anticounterfeiting measures.
Juanita Duggan, president and chief executive officer of AAFA, sent a letter to Alibaba executive chairman Jack Ma on Friday outlining her members’ concerns about counterfeits on Alibaba’s online platforms, which include the Taobao marketplace.
“There’s been a lot of talk but little public, verifiable results,” said Duggan. “It should be in everyone’s interest, including Alibaba’s, that it share its progress.”
Duggan said in the letter that AAFA’s members are asking Alibaba to address counterfeit concerns more quickly and in a more transparent manner. The association, which represents more than 340 companies and 1,000 brands, is also asking Alibaba to create a process where the company removes counterfeits quickly at the request of certified brands.
Duggan said the process must contain four “critical elements: easy brand certification, brand-controlled ‘takedowns,’ brand-approved sales and a transparent verification process with results made public.”
“During your recent tour of the U.S., you made very compelling remarks about an ambitious goal to grow Alibaba’s platform and to make even more products available to more people,” Duggan wrote in the letter to Ma. “If Alibaba is successful in this endeavor — without first addressing the systemic presence of counterfeits — then regrettably, Alibaba will succeed in proliferating counterfeits worldwide.”
An Alibaba spokesman said the company has not seen AAFA’s letter and declined to comment on it directly but defended the steps it has taken to combat counterfeits.
“The Alibaba Group is dedicated to the fight against counterfeits,” he said. “We work closely with our government partners, brands and industry associations to tackle this issue at its source. We also utilize technology like data mining and big data to scrub our platforms of counterfeits.”
AAFA and Alibaba have been engaged in discussions for years, but the relationship became strained in April when AAFA lodged two formal complaints with the U.S. government, charging that the counterfeit problem on Alibaba’s online platforms was worsening and costing brands millions of dollars in lost sales a year.
The U.S. Trade Representative’s office outlined concerns about Alibaba’s Taobao platform and the Chinese government’s oversight and enforcement of counterfeits in two separate reports earlier this year.
Duggan said in a statement that because of a lack of transparency, “no one understands Alibaba’s process.”
“It is obviously flawed,” Duggan charged. “What Alibaba has in place is slow, unclear, cumbersome and full of barriers. The ultimate metric is whether counterfeits on the sites are permanently removed, and right now, they are not.”
She said searches of brands on “any given day” turn up “hundreds, if not thousands, of results at alarmingly low prices — a giveaway that the products are fake.”
She also said Alibaba’s efforts to address counterfeits with other organizations, companies or governments have been “shrouded by non-disclosure agreements, prohibiting the parties that enter into Memoranda of Understanding with Alibaba from talking about the procedures or results.”
Alibaba publicly defended its measures in April, outlining several steps it has taken to prevent counterfeiting and pirated goods from being offered or sold on its marketplaces. The measures include the use of data-mining technology to analyze and track transactions of infringing products and identifying “hot spots” of counterfeit distribution and sales and collaborating with Chinese public security, copyright, quality inspection and intellectual property agencies to take down online counterfeiters.
In further defense of its anticounterfeiting measures, Alibaba on Friday pointed to an agreement it has signed with the International AntiCounterfeiting Coalition. Bob Barchiesi, president of the IACC, said Alibaba participates in the IACC MarketSafe program, a strategic collaboration aimed at combating counterfeits online.
Barchiesi said the program has run “exceptionally well.” Although IACC has signed a nondisclosure agreement with Alibaba, he outlined in general terms how the program has been effective and has led to a 100 percent takedown rate “when companies stand behind their claims.” On average, there have been 120,000 takedowns of counterfeit listings on Taobao and T-Mall in the past year, he said.
Barchiesi said IACC has developed an expedited registration process for companies through the program. Companies are able to register trademarks with Alibaba in one to two days, compared to a six-month wait in the past. Once a complaint is submitted to Taobao or T-Mall, after review by IACC, a takedown is swift, he said, noting a listing comes down within 24 to 48 hours.