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Alibaba blames Chinese authorities for lack of action on counterfeiters

Chinese e-commerce company Alibaba is pointing fingers at Chinese lawmakers, as accusations of widespread counterfeiting loom over its U.S. expansion.

"Ambiguous" counterfeiting laws in China are the fundamental factor hampering Alibaba's fight against counterfeiting, the company said in a statement. While Alibaba is feeding leads to Chinese law enforcement, only a sliver are followed up by criminal investigators, the company said.

Jack Ma, Chairman of Alibaba Group at the World Economic Forum in Davos, Switzerland.
David A. Grogan | CNBC
Jack Ma, Chairman of Alibaba Group at the World Economic Forum in Davos, Switzerland.

In the year leading up to August 2016, Alibaba took down 380 million product listings as an anti-counterfeiting measure. But just a fraction of cases made it through the criminal justice system, the company said: Of nearly 4,500 eligible cases last year identified by Alibaba, 1,184 were pursued by law enforcement, leading to 33 convictions, Alibaba said.

"As a private enterprise, Alibaba has no law-enforcement power, " Alibaba said. "The criminalization of drunk driving once delivered a clear message to society that violators will have to face serious consequences for their actions. Such a message served as a deterrent. We hope our society can reach a consensus to collectively increase the resources and efforts towards combating counterfeiting to no lesser extent than was done with drunk driving."

Alibaba sued two merchants over counterfeiting earlier this year, the first case of its kind the company has filed. The suit came after Alibaba marketplace Taobao was placed on the blacklist of "notorious marketplaces" by U.S. regulators.

The black mark came at a bad time for a company that's gunning for a massive U.S. expansion. Executive chairman Jack Ma told President Donald Trump that he plans to support 1 million new U.S. jobs over the next five years.