China Thoroughly Scrutinizes eCommerce: Will The Country Be Successful In Controlling Fake Goods?

People tend to associate China with counterfeit goods. In order to provide protection against intellectual property theft, China is trying to control the production and selling of fake goods on the eCommerce market.

China is all prepared to reduce the "brushing" practice among eCommerce market. Brushing refers to the procedure of fake transaction and customer feedbacks to improve the reliability of the traders. The fall of Alibaba Group Holding Ltd. is one of the finest examples how China has started scrutinizing eCommerce thoroughly to control doubtful business practice.

According to WARC reports, Elinor Leung, an analyst at Hong-Kong based investment group CLSA, observed: "You have to go through this process before you have a true consumption market in China. Nobody can avoid it, including Alibaba." In order to make eCommerce market sustainable, such strong moves sometimes help.

As per experienced analysts and brands, the modified rules and regulations of ecommerce platforms will be a successful step towards preventing unauthorized sale of counterfeit goods. Chinese regulators have started criticizing the eCommerce establishments for not checking and stopping strictly the sale of counterfeit products and other types of unethical activities.

To avoid any further damage, Alibaba is taking stringent steps to improve their business policies. As WSJ reports, "an Alibaba Group spokeswoman said the company complies with China's laws and regulations and "supports government initiatives to promote the healthy development of China's e-commerce industry." Since Alibaba introduced their modified eCommerce policies, their restrictions now allow only authorized resellers and brands.

As per Reuter's report, "The State Administration for Industry and Commerce (SAIC) plans to step up random quality checks for goods bought online, according to a statement on the regulator's website." Not only that, the SAIC will also verify the consumer and press reports and expect full cooperation from eCommerce platforms. Besides, Alibaba, other rival companies like JD.Com and others are also under the constant supervision of China's regulators. Authorities are now determined to shake off China's age-old image of boasting market plagued through extensive intellectual property violation and consumer safety scares.

There are certain steps that China authorities reinforce to maintain their reputation and healthy eCommerce markets.  These include brands and resellers need to meet the regulator's standards. Otherwise, they will not be allowed to sell. The eCommerce platforms will also hold responsible for getting rid of the low quality products as well as unauthorized activities. Regulators will take serious actions if eCommerce platforms do not cooperate with them.

Also the cabinet of China stated that they are planning to wipe out the violation of intellectual property rights along with controlling fake goods on the online platform within next three years. Till now, the actions taken by the country seems promising and this initiative will surely be a success if China is ready to maintain this temperament throughout.