"Taobao gets stricter every year, and last year they became particularly serious. I heard it was because they'll IPO," said the merchant, who didn't want to be named for fear of his business being damaged or legal repercussions.
He added that if Alibaba shut down his online store, he'd simply open another using a friend or relative's details to register.
Alibaba declined to comment, citing the company's pre-IPO quiet period.
With Alibaba, "the process is a lot more involved," said Rick Watson, CEO of Merchantry.com, which builds online marketplace software for Amazon and other companies. "They ask a lot more questions. They ask for upfront money—a deposit. I'm not aware of the U.S. companies doing that."
Almost a quarter of Alibaba's 20,000-plus workforce, plus volunteers, form an IP protection team, and the company spends over 100 million yuan ($16 million) a year fighting counterfeit goods. In the past year, it removed more than 100 million hyperlinks to products suspected of IP infringement, the company said in a February filing to the World Intellectual Property Organization (WIPO).
EBay spends as much as $20 million each year on "buyer protection programs", such as reimbursing buyers for fake goods they bought on eBay's market, according to a 2010 U.S. federal court filing after Tiffany & Co alleged that eBay did little to clear up counterfeit goods sold on its site.
The San Jose, California-based company also set up a "Trust and Safety" department with some 4,000 employees, including more than 200 who focus just on combating infringement, and 70 who work exclusively with law enforcement, the court filing noted. eBay has a total workforce of around 33,500.
"Nothing is more important than the trust of our customers," and eBay employs a range of anti-counterfeit and fraud measures, a spokesman said in emailed comments to Reuters, adding that eBay has more than 40,000 rights owners signed up to its Verified Rights Owner Program.