Joe Tsai, executive vice chairman of Alibaba, had harsh words yesterday for a report by the State Administration for Industry and Commerce (SAIC) in China that alleged the e-commerce giant has not done enough to rid counterfeit goods and illegal products sold by parties on its Tmall marketplace.
Calling the report "flawed," Mr. Tsai told analysts Alibaba was "a company with strong values." He added that while counterfeits are an unfortunate reality online and in brick & mortar stores today, Alibaba has a "zero tolerance policy" when it comes to illegal activities, because the "health and integrity of our marketplaces depend on consumer trust."
Mr. Tsai said that last year, Alibaba had cooperated with Chinese Law Enforcement in over 1,000 counterfeiting cases and that 400 suspects were arrested from 18 crime rings. Some 200 stores, factories and warehouses were shut down as a result.
Last August, a Wall Street Journal report pointed out that Alibaba had struck deals with a number of consumers brands including Burberry, New Balance and Nike in which they would open stores on Tmall if the marketplace operator removed gray market goods from the site. In the case of Burberry, Alibaba was successful in closing 48 out of 50 unauthorized vendors.
