Alibaba vows to stamp out fakes after membership suspension

Traders wait for Chinese online retail giant Alibaba's stock to go live on the floor at the New York Stock Exchange in New York on Sept 19, 2014. In 2015, Gucci and other brands owned by Paris-based Kering SA filed a suit in New York against Alibaba.[Photo/Agencies]

E-commerce giant Alibaba has pledged to stop fakes appearing on its online platforms after being suspended as a member of an international anti-counterfeiting group.

Alibaba Group Holding's membership was suspended by the International Anti-Counterfeiting Coalition on Friday.

The suspension came only about a month after the company became the first e-commerce member of the nonprofit global organization that fights counterfeit products and piracy.

The coalition announced the suspension after questions were raised about conflicts of interest involving the organization's president and complaints from some members, who view Alibaba as a haven for cheap counterfeits.

Alibaba said on Sunday the suspension will not affect its relations and cooperation with the coalition. "As the world's largest e-commerce platform, Alibaba is an integral part of the solution to solving the worldwide issue of counterfeiting," the company said.

"We will continue to discuss and communicate with more brands in the IACC … expedite the process to remove products identified as fakes and protect the interest of brands, no matter big or small," it said.

The coalition has more than 250 member companies, including leading brands such as Apple and Rolex.

According to people familiar with the matter, the suspension is likely to lead to Alibaba Executive Chairman Jack Ma calling off his plan to deliver a keynote speech at the coalition's annual spring conference in Orlando, Florida, from Wednesday to Friday.

The suspension comes as Alibaba is transitioning from a platform attracting buyers with cheap goods to providing good quality, genuine brands. Membership in the coalition is the type of endorsement the company is looking for to back this transition.

Tian Hou, an analyst at TH Capital in Beijing, said Alibaba is keen to seek global recognition in line with its status as the world's largest online retailer. "It is willing to clean house, but all transitions and upgrading require time," Tian said.

The coalition memberships of two US e-commerce sites, Wish.com and The RealReal, have also been put on hold.