Connect with us

Business

Alibaba Punished By U.S. Government For Counterfeit Goods

The Office of the United States Trade Representative just listed Alibaba back on its Notorious Markets List just four years after it was removed from that list for combating fraud. How bad is this for Alibaba and why is Jack Ma pointing fingers at the new administration already?

Avatar

Published

on

Alibaba has been competing with Amazon for years in the online retailer space. But that competition just took a surprise turn for Alibaba – and Amazon should be celebrating. On Wednesday, the Office of the United States Trade Representative placed Alibaba back on its Notorious Markets List just four years after Alibaba was removed from that list for combating fraud. How bad is the news for Alibaba? What happens next for the e-commerce giant?

Alibaba Provided Counterfeit Products To US Customers. BIG MISTAKE.

Alibaba has stated on numerous occasions that the company is doing everything in its power to combat fraud on Alibaba sites, but those efforts couldn’t prevent the company from being noted as a fraudulent marketplace by the office of the U.S. Trade Representative. The Notorious Markets List “highlights prominent online and physical marketplaces that reportedly engage in and facilitate substantial copyright piracy and trademark counterfeiting.” The specific site in question is called Taobao, which is a fee-free marketplace connecting buyers and sellers. Think Ebay, but with no bidding or fees. Revenue comes from selling ad space and promoting those ads to users based on their product searches. Alibaba, obviously upset with the decision, claims the action is a result of Donald Trump taking office. Do they have a point?

Yes and no.

Trump has most definitely taken a hardline stance against China and Chinese companies. And that thought process may have a trickledown effect in the government. But while that idea may have shined a light on Alibaba, Taobao is just too full of knockoff goods. There’s a reason the company was on the list up until four years ago. Taobao is a massive platform with too little regulation. And while prices and lack of fees are very appealing to shoppers, Alibaba needs to do more to appeal to shoppers.

Alibaba continues to try and bring on Western brands in order to bring in Western shoppers. But this latest news is a huge setback for that plan. As a result of the blacklist, Alibaba’s reputation is tarnished and web traffic could be reduced due to loss of security certificates resulting in security prompts for shoppers to avoid the site.

Catch Ruth Ajuku’s video on how Alibaba went on and off the government’s list:

Shares of Alibaba Group Holding, Ltd. (BABA) ticked down on the news, and should continue to drop more.

Did you know Disney grossed $7 billion yesterday? Read more about it here.

Follow us on Facebook and Twitter for more news updates!


The statements, views, and opinions of any article, contribution, editorial, or advertisement in this publication are not necessarily those of The Capitalist or its editorial staff, and are not considered an endorsement, sponsorship, or recommendation of any referenced product, service, issuer, or groups of issuers.

This publication provides general information about certain subjects, and should not be construed or taken as advice (legal, financial, investment, tax, or otherwise). Do not construe or take any information in this publication as a solicitation, offer, opinion, or recommendation to buy or sell any securities, bonds, or other financial instruments or to provide any legal, financial, investment, tax, or other advice or service about the suitability or profitability of any financial instruments or investments.

The Capitalist disclaims any liability for the accuracy of or your reliance on any statements, views, opinions, or information in this publication.


Click to comment

Leave a Comment

Continue Reading

Subscribe To Our Newsletter:

Advertisement

Facebook

Copyright © 2020 The Capitalist. his copyrighted material may not be republished without express permission. The information presented here is for general educational purposes only. MATERIAL CONNECTION DISCLOSURE: You should assume that this website has an affiliate relationship and/or another material connection to the persons or businesses mentioned in or linked to from this page and may receive commissions from purchases you make on subsequent web sites. You should not rely solely on information contained in this email to evaluate the product or service being endorsed. Always exercise due diligence before purchasing any product or service. This website contains advertisements.

[email]
[email]