By Juliane Rose Sun
Oct. 15, 2020
In late September, police raids across several store locations in Thailand netted US$1 million of counterfeit products. Thai authorities seized counterfeit ink cartridges and print supplies under the HP Inc brand. The counterfeiters had been selling them on Lazada.
HP credited Lazada for exposing the illicit sale of counterfeit goods and said that the successful raid was possible due to the sharing of vital intelligence by Lazada with HP’s anti-counterfeit team and the Thai police.
Online marketplaces are reflections of the realities in the offline world, and removal of product listings suspected to be counterfeit is merely a band-aid to a deeper seeded problem. The root cause needs to be addressed to make real and concrete progress, which means catching the bad sellers and manufacturers of the counterfeit goods that exist in the physical world. While Lazada can help offer leads through the digital trail left behind by these criminals, only law enforcement and government agencies can take action to put them behind bars and permanently interrupt the counterfeit trade.
“The use of unlawful counterfeit supplies can result in printer damage, malfunctions, and printer hardware warranties becoming void. To protect consumers, businesses, customers and partners, the HP Anti-Counterfeiting and Fraud Program proactively works with partners like Lazada to deliver added value to consumers, business customers and partners. This ensures security, reputation protection, seamless operations and cost savings,” said a HP spokesperson.
In another recent raid, Malaysian authorities seized more than 90 counterfeit Panasonic electrical products at the GM Plaza in Kuala Lumpur. They confiscated hair clippers, blenders and irons. Counterfeit electrical goods pose potential safety hazards to consumers as they are unlikely to meet compliance standards. Materials used to make the counterfeit goods are probably of low quality. For this reason, brands like Panasonic are all the more invested in stopping the manufacturing and distribution of counterfeit goods.
As online shopping becomes mainstream, eCommerce platforms, brands and law enforcement authorities are working more closely together to identify, locate and take down counterfeiters. Conducting a raid is complex and often involves multiple parties. Such essential collaboration protects consumers from unwittingly buying and using unregulated and possibly unsafe items. Concerted action effectively deters offenders because they know their illegal activities are under continual scrutiny.
“There are now a lot of people who are new to online shopping, and thus more vulnerable since they do not know how to protect themselves,” said Andy Chua, the senior vice president who leads the regional brands protection team at Lazada. The team, formed in March 2019, now comprises nine people, all with experience working in the fraud prevention and risk management fields, in both the public and private sectors. Chua spent 17 years with the Singapore police force as an officer, including enforcing and investigating intellectual property rights infringement.
Leveraging on Alibaba’s technology, the team manages Lazada’s Intellectual Property Protection (IPP) platform. This is an online portal for rights owners use to upload their proof of IP rights. This then enables them to submit requests against listings that may infringe on their rights, seek their removal and track the progress of their request. Once submitted, the removal request is processed within three or four days on average.
Lazada’s brand protection team also puts measures in place to proactively monitor the platform for counterfeits. Working with the brands, such monitoring mechanisms have been so effective that they can zero in on fake products and remove them automatically. Although still at the pilot stage and limited to the Singapore market only, these mechanisms have already led to 99 per cent of identified fake listings being taken down even before a single sale was finalised.
In addition, Lazada invests heavily in merchant education to maintain rigorous platform governance. All new merchants are required to go through a series of educational modules through the web-based Lazada University course. These modules school the newcomers in awareness of platform terms and conditions, as well as policies regarding intellectual property rights. They also make the newbie merchants aware of consequences for non-compliance, which include escalating penalties, account suspension, and account termination.
LazMall’s authenticity guarantee is a prime example of the platform’s commitment to safeguarding brands’ rights and ensuring peace of mind for shoppers looking for branded merchandise.
Consumer education is another integral part of a continuing anti-counterfeiting battle. Chua said: “We urge Lazada shoppers to shop smart, to keep your eyes peeled for potentially fraudulent activity and to report them. If there are certain marketplace discounts that seem ‘too good to be true,’ they usually are. Other telling characteristics of counterfeit products include popular brand names being purposely misspelled and shops with very poor ratings.”
“As an operations team, we run into daily challenges to balance the needs of our sellers, buyers, rights owners and other stakeholders. The problems we solve are complex and involve a wide set of responsibilities, but it is very rewarding to see the platform safe and our consumers happy,” said Simon Zhou, a senior operations manager in the brands protection team.
Juliane Rose Sun is a manager in Lazada’s Security Risks and Enterprise Intelligence team who works closely with brands in safeguarding their intellectual property rights.