China says Alibaba’s Merchants Sell Fake Merchandise

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According to the Chinese government, Alibaba has a major credibility problem.  The government issued a report station that the tech giant knowingly allows fake and counterfeit items to be sold on its platform.

The scathing report by the State Administration for Industry & Commerce accused Alibaba of allowing merchants to operate without required business licenses, to run unauthorized stores that co-opt famous brands and sell fake wine and handbags. Alibaba employees took bribes, and the e-commerce giant didn’t fix flaws in customer feedback or internal credit-scoring systems, the report said.

“For a long time, Alibaba hasn’t paid enough attention to the illegal operations on its platforms, and hasn’t effectively addressed the issues,” the report said. “Alibaba not only faces the biggest credibility crisis since its establishment, it also casts a bad influence for other Internet operators trying to operate legally.”

Bob Christie, a spokesman for Alibaba, said the Hangzhou-based company couldn’t immediately comment.

A statement posted on the official Weibo account of Alibaba’s Taobao Marketplace Wednesday afternoon said the company was improving technology to fight against fakes and was willing to work with regulators on its procedures. The site also said it would file a complaint against the SAIC’s Internet regulation director, Liu Hongliang, who presided over a meeting with Alibaba representatives in July to discuss the claims.

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