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Chinese authorities to build big data center to fight online counterfeit goods

The Chinese government is planning to build a nationwide e-commerce big data center in Hangzhou, the city of Alibaba’s headquarters, in efforts to crack down on counterfeit sales online, the National Business Daily reports.

By building these four networks: a sharing network, an anti-counterfeit network, a standards network and a collaborative inspection network, the Hangzhou government plans to use data analysis to help enforce the law.

A source close to the General Administration of Quality Supervision, Inspection and Quarantine who is familiar with the plan told National Business Daily that building the data center is an important step to keep the online distribution of counterfeit goods under control.

E-commerce sites have been been growing rapidly in the last few years. According to an annual report from iResearch, which provides market data on online business services in China, the Chinese e-commerce market reached RMB 16.2 trillion (USD 2.5 trillion) in 2015, a 21.2% growth compared to 2014. Online shopping contributed 37.2% of the overall growth of the e-commerce industry.

Behind the rapid growth is the problem of vendors selling counterfeit goods. There are customers on e-commerce platforms complaining about fake merchandise every day, especially from third-party merchants.

For instance, a group of customers who claimed to have purchased fake Chinese liquor from Chinese luxury e-commerce platform VIPShop filed a lawsuit against the platform in early January. A local Chinese clock distributor was also caught forging certificates for watches and selling them on VIPshop.

Alibaba founder Jack Ma said that Alibaba is also a victim of counterfeit activity, in response to accusations that Alibaba built its empire by allowing the sale of counterfeit goods on its platform.

Chinese authorities inspected 502 online samples in October 2014 from 359 e-commerce businesses, and only 73.9% of the merchandise passed the quality inspection. The passing rate didn’t even reach 72% in another inspection in 2015.

The aforementioned anonymous source said counterfeits are proliferating because there are low entry thresholds for vendors on e-commerce sites and their supply chains are complicated. The source also said Chinese authorities are behind in monitoring e-commerce sites.

(Top photo from Baidu Images.)

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