Schibsted’s Vibbo also on USTR’s blacklist

22 Dec 2016

Schibsted’s Vibbo.com (formerly Segundamano.es), is on the 2016 blacklist of trademark-neglecting sites compiled annually by the Office of the U.S. Trade Representative (USTR). 

Other sites on this year’s blacklist are, among others, Alibaba Group’s Taobao, and Mail.ru’s VKontakte (the so-called Facebook of Russia). Naspers holds a sizable stake in Mail.ru.

Unlike Alibaba Group, neither Schibsted nor Mail.ru has responded to the news yet. Read our report on Alibaba’s response here.

In its report (here in PDF), USTR motivates extensively why Vibbo, VKontakte and Taobao are on the 2016 list.

In fact, USTR calls this its list of “notorious markets”. It can’t be nice to own and operate a marketplace called “notorious”! The affected owners will certainly have something to say. We’ll keep you posted.  

In the meantime, we extracted and republished the three motivations in full. Included in the motivations are insights in what USTR would like sites to do, to get off future blacklists.  

Extract starts:

Vibbo.com

Vibbo is one the most popular e-commerce platforms in Spain, connecting many users to a wide variety of products and services. While the terms of use expressly prohibit activity that violates IPR, some sellers reportedly use the platform to sell and distribute counterfeit security tags and circumvention devices and services. Circumvention devices and services break the technological protection measures in game consoles and handheld devices to enable unauthorized uses or the copying of game software. In many countries, including Spain, this is in direct violation of the law. Some sellers also openly advertise that their games and services are pirated. Right holders report that Vibbo is largely non-responsive to notices of infringing activity.

 Taobao.com

The Taobao.com e-commerce platform is an important concern due to the large volume of allegedly counterfeit and pirated goods available and the challenges right holders experience in removing and preventing illicit sales and offers of such goods. Taobao is a consumer-to-consumer marketplace that offers “hundreds of millions of product and service listings.” In 2014, Taobao ranked as China’s largest online shopping destination by gross merchandise volume and the Mobile Taobao App stood as the top Chinese e-commerce app in March 2015.

According to Alexa rankings, Taobao.com is among the 15 most popular websites globally and among the top 5 websites in China. Right holders in the United States and internationally continue to report serious challenges to reducing high levels of counterfeit and pirated goods on Taobao. Longstanding obstacles to understanding and utilizing basic IP enforcement procedures continue unabated. Right holders report that initial attempts to report IPR infringement are refused inconsistently; denials of takedown requests contain little to no justification or guidance on how the right holder may amend its notification to get results; error messages stall or prevent use of IP complaint systems; pertinent communications to right holders are not translated from Chinese; and broken hyperlinks prevent direct communication between right holders and Taobao sellers.

 Taobao’s parent company, the Alibaba Group (hereinafter Alibaba), reportedly has taken steps to address right holders’ concerns on Taobao by, for example, establishing internal offices focused on IPR and appointing experienced officers to guide these efforts, addressing the misuse of brand keywords and blurred trademarks in product images, and developing technology to prevent counterfeit sellers from re-opening. Alibaba claims it has proactively removed more than 380 million product listings and closed approximately 180,000 Taobao stores in the 12 months ending August 2016. Prospectively, Alibaba has announced a shift from a Four Strike to a Three Strike Policy and the launch of a Joint Force System that is intended to expand proactive enforcement efforts. The Good Faith Program reportedly is intended to provide a more effective and efficient avenue for participating right holders to enforce their IPR, and participation has grown with Alibaba’s support.

Unfortunately, the Good Faith Program reportedly remains out of reach for the vast majority of right holders, particularly SMEs, due to stringent eligibility criteria that must be met and maintained over a period of time. There is a reported significant disparity between the timeliness and effectiveness of Alibaba’s responses to complaints submitted by right holders in the Good Faith Program and those outside the program.

While recent steps set positive expectations for the future, current levels of reported counterfeiting and piracy are unacceptably high. Not only do counterfeit and pirated goods pose a grave economic threat to U.S. creative and innovative industries, undermining the Chinese and global market for legitimate U.S. products, substandard counterfeits such as auto parts pose a potential public health threat to unsuspecting consumers. One large motor vehicle manufacturer reported that at least 95 percent of the merchandise bearing its company’s brand names and trademarks found on Alibaba platforms is suspected to be counterfeit.

Given the dominance of Chinese sellers on Alibaba’s platforms, it is critical that the Chinese Government support these efforts through measurable enforcement efforts across China and stronger domestic IPR reforms identified in previous Special 301 reports such as the development of its E-Commerce law. In 2017, the United States will closely monitor the implementation and effectiveness of the set of prospective actions described in Alibaba’s Notorious Markets List submission. As Alibaba moves forward with its plans to further reform and enhance its enforcement tools across platforms, the recommendations highlighted in the 2015 List remain valid, namely:

(1) simplifying processes for right holders to register and request enforcement action; (2) making good faith takedown procedures generally available; and (3) reducing Taobao’s timelines for takedowns and issuing penalties for counterfeit sellers.

In addition, the United States welcomes increased efforts to further refine and identify metrics to assess objectively the scale of infringing products sold over Taobao and other Alibaba platforms, as well as additional attention to the needs of SMEs, such as by devoting resources to provide proactive takedowns tailored to assist SMEs.

Senior corporate representatives at Alibaba have noted that, “[Alibaba has] the responsibility to be the global leader in anti-counterfeiting… the scale, . . . the data and . . . the commitment.” The U.S. Government remains committed to working with Alibaba and right holders to find effective solutions to curb infringing activity on Taobao and other Alibaba platforms, and to resolve the concerns raised by right holders.

 VKontakte (Vk.com)

Nominated again this year, VK is one of the most popular sites in the world and continues to operate as an extremely popular social networking site in Russia and neighboring countries. VK reportedly facilitates the distribution of copyright-infringing files. Social networking sites can serve as a uniquely valuable communication platform, enabling beneficial commercial, cultural, and social exchanges. Most successful social networking sites do so in ways that do not involve the active facilitation of copyright infringement.

Reports that VK is taking steps to address piracy are encouraging. In particular, VK has reached licensing agreements with major record companies, has taken steps to limit third party applications dedicated to downloading infringing content from the site, and has experimented with content recognition technologies. Despite these positive signals, VK reportedly continues to be a hub of infringing activity and continues to be listed pending the institutionalization of appropriate measures to promote respect on its platform for IPR of all right holders, not just those with whom it has contracts, that are comparable to those measures used by other social media sites.

Extract ends.

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Christo Volschenk

Christo Volschenk is managing editor of the news on Aimgroup.com and our senior analyst covering Naspers. He brings more than 31 years of experience in business journalism to the team - the last 18 years focused on classifieds and e-commerce. Apart from working closely with the AIM Group, Christo is a freelance journalist, content manager, and copy editor. Before branching out on his own, he spent 15 years with Naspers in South Africa as journalist, economics editor and online project manager. He now spends most his day editing the news reported by 23 colleagues in 23 countries from his base in Stuttgart, Germany.