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BEIJING — China’s best-known spot for knockoffs has been completely knocked down.

The famous Silk Alley was closed and subsequently razed early last month, ending the market’s 20-year reign as the country’s best-known spot for counterfeit goods. Although the Chinese government  has officially said the market’s closing was due to fire hazards, they also have touted it as an example of their increasing commitment to enforcing intellectual property rights in the country.

The Silk Alley spot long has been known as the place to buy designer fakes of all qualities, from New Balance sneakers to Louis Vuitton handbags. Since September, however, the number of name brands on display had dwindled as the Chinese government stepped up its efforts in a yearlong crusade against counterfeit goods.

But the true extent of the government’s very vocal commitment against sales of fake products remains to be seen, though not for long. Just next door to the now-empty alley lies a brand-new shopping mall, which officially will open as the new Silk Street Market on March 11, according to a government announcement last week.

The new mall, a modern glass-and-tile behemoth, has been under construction since last year. A recent visit found workers in yellow hard hats putting the finishing touches on the nearly finished structure, which included navigating metal beams around groups of curious tourists who had come looking for the old Silk Alley, only to find an empty street and a pile of garbage in its place.

The new market already has plenty of earnest — if somewhat amusing — signs on display, in hopes of luring back the 100,000 visitors that once stopped by the old Silk Alley every day. Red and yellow banners tout it as a “Fashion zone for the salariat” and a place to “Conspicuously show the oriental nature.”

More banners promise a selection of “Gewelry” and other items — though whether there will be a high number of fake products is still unknown. One sign advertising bags and shoes shows a women’s high heel in what looks suspiciously like the signature Burberry plaid. Chinese officials have been under intense pressure from foreign governments, particularly the U.S. Embassy and the European Union office in Beijing, to curb the knockoffs once and for all when the new market opens.

This story first appeared in the February 9, 2005 issue of WWD. Subscribe Today.

The counterfeiting issue hasn’t been the only controversy surrounding the new Silk Street market, though. After Silk Alley shut down in early January, local merchants gathered in protest in front of the bulldozers, arguing they’d been pushed out of the market they had helped build. Many of them were left without a place to sell their products, effectively cutting off their income.

“A lot of the old Silk Alley merchants will be moving into the new building, but they’re not happy about it,” says one shopkeeper. For now, he has moved his sweater business — which consists of mostly unbranded items along with a few labels such as Kookai — to another shopping center nearby, but will move again to a stall in the new market for the March 11 opening.

“[Silk Alley’s closure] hasn’t affected me at all, because I have loyal customers and they know where to find me,” he said. “But many shop owners couldn’t find new stores after the market was shut down. They had nowhere to go.”

Though many of the shopkeepers have complained about higher rental costs, the merchant said his monthly rent will be about the same as in the old alley — about $2,400 a month for a good location. Less desirable locations will rent for about $1,200 a month, he said. According to Chinese newspapers, all 1,500 stalls in the new building have been rented.

“The problem isn’t the cost of the rent,” he said. “The problem is that the whole feeling of the market has changed. The layout means that customers won’t walk by every stall now [as they had to in the old market], so sales will drop. Before, shop owners could sell about 2,000 things per day. In the new building, I think they will sell about five per day.” The old Silk Alley did business of some $12 million a year, according to the government.

The market’s March 11 opening is being closely watched for many reasons. But anticounterfeiting advocates say even if Chinese enforcers are able to limit the selling of fake goods as a show of their commitment, it’s clear Silk Alley is just the tip of a very big iceberg.

After all, the still-open underground market just underneath the Silk Street building continues to do brisk business. The big sellers? North Face-branded jackets for about $20 and Ralph Lauren polo shirts for $4.