The head of China’s commerce regulator met with Alibaba Group Holding Ltd (阿里巴巴) chairman Jack Ma (馬雲) on Friday to discuss combating fake products, Xinhua news agency reported, with the two adopting a conciliatory tone after a row over illegal business on the Internet company’s platforms.
The meeting took place the same day the Chinese State Administration for Industry and Commerce (SAIC) backtracked on an earlier report that had excoriated the Chinese online commerce company for not doing enough to suppress counterfeiting on its Web sites.
SAIC issued what it called a “white paper” on Wednesday that said many products sold on Alibaba’s Web sites infringed on trademarks or were banned, substandard or fake.
However, in a follow-up statement posted on its Web site on Friday, a spokesman for the regulator said the report was not a white paper and carried no legal force.
“The most recent SAIC posting speaks for itself. We feel vindicated,” Alibaba said in a statement in response.
It is unclear what prompted the regulator’s seeming about-face in a highly unusual episode, one that saw a major Chinese corporation clash publicly with an influential government organization.
While it remains unclear whether the SAIC intended any specific action against Alibaba or counterfeiting in general, analysts said the incident reminded investors of the political risk inherent in Chinese companies, that the country’s regulators might clamp down on business activities with little warning.
In the meeting with the SAIC on Friday, Ma promised to “actively cooperate with the government [and] devote more capital” to weeding out fake goods, according to Xinhua.
SAIC Minister Zhang Mao (張茅) said the company had made good efforts in safeguarding consumer interests and added his agency should find new modes of oversight for e-commerce.
The Chinese company is sensitive to accusations about its efforts to suppress counterfeit products, which span several years. During an earnings call on Thursday, Alibaba vice-chairman Joseph Tsai (蔡崇信) called the SAIC’s initial report “flawed,” and said the firm was preparing to file a formal complaint.
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