Is Alibaba doing a better job at fighting fakes than Amazon?

07/05/2018

Alibaba is fighting counterfeit products more forcefully than its American e-commerce counterpart, according to Swatch CEO Nick Hayek.

“If I look what Alibaba is doing and all these they are trying to make a service to the consumer and to earn money. And they are fighting actively against fakes. This Amazon is not doing,” Hayek recently told CNBC in a televised interview.

The head of the Swiss luxury watch brand’s controversial words follow the collapse last fall of a deal that would have made Swatch’s products available on Amazon.

After months of negotiations, Hayek pulled out, claiming the e-commerce giant was not “proactively policing its site for counterfeits and unauthorized retailers.”

Several months later, his views have far from changed.

 

“They refuse to enter into discussion because they have, I think, 10,000 of lawyers that say, ‘Please, we at Amazon, we should not enter into anything that should force us to fight against fakes.’ The Chinese are doing it. They fight against it,” he said in the interview.

 

Jeff Bezos-owned Amazon pushed back through a spokesperson, telling CNBC that they “quickly investigate reports of suspected infringement and we hold bad actors accountable. Our efforts are even more effective when brands work collaboratively with us, which happens every day.”

The spokesperson added that the company “welcomed the opportunity to work with Swatch” in its Brand Registry.

The registry aims to reduce intellectual property violations, and more than 40,000 brands are registered, according to the company.

“Brands in Brand Registry, on average, report 99% fewer suspected infringements compared with before the launch of Brand Registry, and Amazon took action on 93% of all notices of potential infringement received from Brand Registry within four hours,” the spokesperson told CNBC.

While both companies have been hit with high-exposure, copyright infringement lawsuits, international trade and logistics firm, stateside consumer goods companies and even some politicians are beginning to see things Hayek’s way, according to a fashion law blog.

Established shoe company Birkenstock pulled its products off the site last year, citing rampant copycats. Apple has sued over the site hosting counterfeit chargers.   

Last January, Forbes noted that both companies were enlisting lawyers to fight fakes – a move it called overdue on both ends.

In November of 2017, Amazon filed suit against a company selling fake Forearm Forklifts, a product that allows users to easily lift heavy items, and a seller of bogus TRX Suspension Trainer workout bands.

Soon after, Jack Ma-helmed Alibaba caught two vendors selling fake Swarovski watches on its Taobao marketplace.

Forbes said at the time that Alibaba was acting more aggressively than its American counterpart, by enlisting Chinese law enforcement and seeking criminal prosecution of counterfeitors.

Alibaba also committed $160 million to combating fraud in 2017, and strengthened tech and personnel devoted to the fight.

Still, the company’s Taobao e-commerce platform was blacklisted by the U.S. Trade Representative  for a second consecutive time this year for selling suspected fakes and a 2013 OECD report showed that the majority of fake seizures were occurring in China.

With Hayek’s blunt words still fresh, lawsuits up in the air, and anti-counterfeit policies on both sides still in development, it appears the debate over which e-commerce monolith is best at ensuring authenticity will continue to simmer.

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