USTR highlights safety risks in latest notorious markets report

The 2023 report by the US Trade Representative on notorious markets for counterfeit and pirated goods has been published, but as ever not everyone is happy about its choices.

The latest version (PDF) includes Alibaba's Taobao platform – but leaves out its AliExpress service which is perennially accused of being a major source of counterfeits – and once again includes Tencent’s social media app WeChat as well as e-commerce sites DHGate, Pindoduo and Shopee.

The list – which has been prepared since 2006 – still excludes North American sites such as Amazon, Meta, eBay, Shopify and Wish that are known to carry counterfeits, however, and this is a perennial criticism of its scope. Earlier editions included some of Amazon's ex-US platforms but these are no longer listed.

All told, the 2023 list identifies 39 online markets and 33 physical markets that according to the USTR suspects of engaging in or facilitating “substantial trademark counterfeiting or copyright piracy.” The agency acknowledges that the list is not exhaustive and says it produces a broader analysis in its annual Special 301 report published at the end of April each year, although that does not identify specific marketplaces.

The American Apparel & Footwear Association (AAFA), which represents more than 1,000 brand owners, is among those that have been pushing for a broadening of the list's scope.

“We are pleased to see that USTR retained two markets on the list – DHGate and Shopee,” said the trade organisation’s president and chief executive Steve Lamar in a statement on the latest report.

“At the same time, three key markets that AAFA nominated – Meta, Alibaba Cloud and Lazada – were not listed,” he added. “AAFA members remain deeply concerned about the range of counterfeit dangers, including health and safety and financial risks to consumers.”

The USTR has focused on those risks in the latest version of its report, describing how counterfeit goods are often made of lower-quality materials and are manufactured outside of regulatory oversight or product safety controls, leading to substandard, ineffective, and often dangerous products.

It highlights specific product categories that pose particular risks, including children’s products including toys made from unsafe materials, car parts that could fail, electronics that pose a risk of catching fire, and pharmaceutical and personal care products that could be contaminated with microorganisms or harmful substances.

“The trade in counterfeit and pirated goods harms workers, consumers, and small businesses, and ultimately hurts the US economy,” said Ambassador Katherine Tai. 

“This year’s Notorious Markets List is significant because it underscores the potential dangers of counterfeit goods and why robust enforcement to combat trade in these goods is important to growing our economy from the middle out and the bottom up.”

The AAFA has called on lawmakers to ask hard questions of representatives of major e-commerce and social media platforms – currently testifying in front of Congress this week on the topic of protecting children from harmful content on their platforms – including why they can’t stop the promotion and sale of counterfeits on their platforms.