Online counterfeiting: The worst marketplaces for fake and pirated goods 

The Office of the US Trade Representative (USTR) has published its comprehensive annual review of online counterfeiting on marketplaces, with sites ranked in order of ‘notorious counterfeiting and piracy’. Marc-Emmanuel Mellet summarises its key findings. 

The 2023 Review of Notorious Counterfeiting and Piracy Markets ranks online counterfeiting on marketplaces by volume to identify the worst offenders. As with previous years, the guide also focuses on a specific issue related to counterfeiting or piracy; in this case, the potential health and safety risks posed by counterfeit products. In comparison, the 2022 ranking highlighted the negative impact of online piracy on workers. 

Online counterfeiting: The dangers to consumers 

Counterfeiting is not only harmful to companies and IP owners. In many cases, counterfeit products also pose significant risks to the health and safety of consumers.  

Counterfeiters operate outside of regulations and inspection systems, using substandard materials and failing to comply with required safety standards. Products created under these conditions can pose serious risks to consumers who are not always aware of the dangers of these “everyday” items.  

This is particularly the case for counterfeit versions of toys and children's products, car components, electronic products, pharmaceutical products, cosmetics, clothing and shoes. Proper and effective enforcement of trademark and anti-counterfeiting legislation by rights holders and border control plays a key role in reducing the potential health and safety risks associated with counterfeiting. 

Elsewhere, the 2023 Notorious Markets guide features various examples of counterfeit-related technologies, concealment methods and revenue models, including the use of ‘cyberlockers’ to distribute pirate content anonymously. ’Bulletproof’ internet service providers were also singled out for facilitating counterfeiting activities. The analysis also highlights ongoing concerns over sales of counterfeits, through e-commerce platforms and social media, as well as the growing use of influencers to promote fake and ‘dupe’ products. Efforts by some platforms to combat counterfeiting with new technologies and verification practices were also noted, however. 

Which marketplaces are the worst offenders? 

Below is the USTR classification of e-commerce platforms and marketplaces: 

• Avito is an online advertising platform based in Russia with classified ads for counterfeit products. Rights holders have difficulty getting these listings removed because the site requires detailed proof of infringement and does not take effective action against repeat infringers. More generally, Avito appears to lack the will to work with rights holders to prevent the sale of counterfeit products. 
• Bukalapak is one of Indonesia’s leading e-commerce sites. Despite the site's prominence, rights holders note a lack of resources to challenge counterfeiting on the platform, with little effect on the availability of counterfeit products. Although improvements have been made to the notice and takedown process, concerns persist about the lack of sanctions against repeat infringers. 
• DHgate is the one of the largest cross-border e-commerce platforms in China. While the company has implemented new initiatives to improve seller screening and counterfeit monitoring, there is still a high volume of counterfeit products on the site. Despite the introduction of tougher penalties for repeat offenders, falsification of seller identification documents is still a problem. Likewise, rights holders also note the common practice of using hidden links by influencers on social media to promote counterfeit products.  
• IndiaMART is a leading business-to-business e-marketplace in India. Despite measures to combat counterfeiting, such as a dedicated online IP complaint form and a seller verification process, there is a significant presence of counterfeit products on the platform, particularly in the pharmaceutical, electronics and clothing sectors. Rights holders express concerns about the lack of proactive monitoring of counterfeit products and the lack of clear certifications from sellers. 
• Pinduoduo is a major e-commerce platform in China. Although the platform claims to have anti-counterfeiting initiatives in place, rights holders report a lack of proactive measures to filter sellers and listings, onerous proof requirements, excessive withdrawal times and a lack of transparency. Additionally, rights holders note a deterioration in seller control, with sponsored ads labelled as "authorised sellers" misleading consumers. Rights holders also find it difficult to obtain information and support for their counterfeiting investigations. 
• Shopee is a leading Singapore-based e-commerce platform that has stepped up its efforts to protect brands and combat counterfeiting, expanding its IP portal and launching a partnership program to strengthen proactive control. Despite improvements in reporting procedures and takedown times (e.g. in Taiwan and Vietnam), some rights holders are reporting high volumes of counterfeits on some Shopee platforms, particularly in Brazil and Indonesia.  
• Taobao is Alibaba's platform for Chinese consumers, one of the largest e-commerce platforms in the world. Although Alibaba has taken proactive steps to improve its anti-counterfeiting processes and worked with authorities to combat counterfeits, a recent reorganisation is raising concerns about its limited resources, with rights holders reporting a high presence of counterfeit products and an increase in pirated products on Taobao, in particular. Rights holders are calling for improvements to the infringement reporting process, including less strict criteria for takedown notices and better vetting of sellers, particularly those at the "Tao Factory" store who remain listed despite repeated complaints.  
• WeChat (Weixin) is a major platform for the sale of counterfeit products in China. Although its owner Tencent has increased efforts to combat counterfeiting, including new monitoring tools and enhanced penalties, concerns persist about the platform's ability to proactively enforce these measures across the world. Repeat offenders also continue to be a problem, with some resuming their fraudulent activities shortly after being blocked. 

Which are the worst registrars and hosts? 

According to the USTR, the worst offenders are: 

• Amarutu is an offshore hosting provider known for being ‘bulletproof’ (in other words, unresponsive to complaints or requests to remove illegal content) and so frequently used by piracy sites. Although claiming to have a Hong Kong address and data centres in Hong Kong and the Netherlands, Amarutu is registered in the Seychelles. 
• FlokiNET is another 'bulletproof' hosting provider that is accused of supporting infringing websites by refusing to cooperate with rights holders and authorities. Not only does FlokiNET ignore notifications of illicit activity, but its website also explicitly encourages anonymous hosting of content. It is also suspected of hosting numerous sites linked to copyright infringement in several countries. 
• Squitter Networks (or ABC Consultancy), another ‘bulletproof’ provider, hosts several online piracy services, despite ongoing investigations into the true locations of the site and associated companies. Squitter appears to operate anonymously, ignoring thousands of takedown notices and not responding to any communications. 

Online counterfeiting on marketplaces: What should rights holders do? 

Given the vast number of e-commerce sites and marketplaces that host counterfeit or otherwise infringing products and content, it can be difficult for brand owners to know where to start. That’s why we recommend working with an online brand protection specialist who can advise on the best monitoring and enforcement strategy for your business. 

For additional insights and tailored advice on identifying and responding to online counterfeiting on marketplaces, speak to your Novagraaf attorney or contact us below. 

Marc-Emmanuel Mellet is a Trademark Attorney at Novagraaf in Paris