Taobao locks horns with regulator

Related stories: Alibaba sets up task force to monitor fakes, by Dai Tian, chinadaily.com.cn

Alibaba has established a special force of 300 staff to fight counterfeit goods, the e-commerce behemoth's shopping site Taobao said on Wednesday, as authorities accused it of failing to crack down on shady merchants.

With help from the government, consumers and data analysis, the company aims to solve the problem thoroughly and efficiently, said Taobao.

Its response came after the most recent round of national inspections of online goods. According to China's State Administration for Industry and Commerce, only 54 out of 92 items bought from online shopping sites between August and October were authentic.

The biggest offender was found to be Taobao.com. Of 51 items bought there only 19 were genuine, said the industry watchdog.

"Alibaba hasn't paid enough attention to illegal operations on its platform and hasn't effectively alleviated the situation," said the SAIC. "Alibaba faces not only the biggest credibility crisis since its founding, but also casts a negative influence for other e-commerce operators".

Taobao posted a response on its microblog, saying the company is willing to work with regulators, but at the same time is to file a complaint against the SAIC's Internet regulation director, Liu Hongliang, claiming that he drew inappropriate and non-objective conclusions after the investigation.

Alibaba Group announced in December that it had spent more than 1 billion yuan ($160.7 million) fighting counterfeit goods and improving customer protection in the past two years.

The company said it had worked with brand holders and tackled six million web links containing infringing items, assisting in more than 1,000 cases and the arrest of nearly 400 suspects.