US-China trade deal covers online counterfeit sales, fake meds

A trade deal signed with week between the US and China includes a commitment to curb the sale of counterfeit goods on online retail platforms.

The ‘phase one’ deal – signed on January 15 by President Donald Trump and Chinese vice-premier Liu He – comes after years of negotiation and calls a truce in a long-running trade war between the two countries that has been blamed for depressing global economic growth over the last couple of years.

The near-100-page document opens with a 16-page chapter on intellectual property (IP), reflecting the US’s often-repeated assertion that Chinese companies are the source of much of the counterfeit and pirated goods, patent infringement and trade secret theft that impacts US companies.

IP is at the centre of the trade war which started in mid-2018, when Trump began setting tariffs and other trade restrictions.

Among the provisions is an agreement for the two countries to work together to prevent piracy and counterfeiting on e-commerce platforms like Alibaba’s Taobao and Amazon. China has pledged to require “expeditious” takedowns of listings for fake products and allow more time for brand owners to file online infringement complaints.

China has also agreed to revoke the operating licenses of e-commerce platforms that repeatedly fail to curb the sale of counterfeit or pirated goods. The US meanwhile has also agreed to investigate “additional means” to fight the online sale of these products.

The agreement also calls for China to generate an action plan within 30 days to implement its commitments, as well as the date each will go into effect.

President Trump has had the online sale of counterfeits in his sights for some time. In 2017 he authorised an inquiry into IP violations in China, and in 2018 he signed a memorandum on combating trafficking in counterfeit and pirated goods that focuses on third-party marketplaces like Alibaba, Amazon and eBay as well as “carriers, customs brokers, payment providers, vendors and others.

Last July, the US government also asked for feedback from brand owners, third-party marketplaces and other stakeholders on the state of pirated and counterfeit goods trafficking online, which received 89 comments.

There are also specific pledges in the area of counterfeit pharmaceuticals and other goods that pose health and safety risks.

China says it will take swift enforcement action in cases of falsified medicines, active pharmaceutical ingredients and bulk chemicals such as excipients, sharing information with the US on pharmaceutical raw material sites, and publishing enforcement data on an annual basis.