For the second year in a row, a number of international Amazon sites have been included on an official U.S. government intellectual property “black list.” Seattle, Washington-headquartered Amazon’s platforms in France, Germany, Italy, Spain and the United Kingdom are name-checked in the annual “Notorious Markets” report, the U.S. Trade Representative (“USTR”) revealed last week, on the heels of a handful of the Jeff Bezos-founded company’s sites being included on the 2019 version of the list, much to the dismay of the $1.56 trillion retail titan.
After reportedly skirting placement on the USTR’s Review of Notorious Markets for Counterfeiting and Piracy in 2018, Amazon made headlines in early last year when a handful of its international e-commerce arms were cited on the USTR’s 2019 Notorious Markets list. In connection with its inclusion of Amazon’s platforms in Canada, the United Kingdom, Germany, France, and India, the USTR asserted for the first time last year that “submissions by right holders expressed concerns regarding the challenges related to combating counterfeits with respect to e-commerce platforms around the world.”
No small matter, the inclusion of Amazon sites on the U.S. government’s 2019 list, a first for the e-commerce behemoth, was characterized as a “watershed event” early last year by the Wall Street Journal, largely due to the company’s American heritage. Amazon is the first American company to be targeted on the annual list – one that identifies “prominent and illustrative examples of online and physical markets in which pirated or counterfeit goods and services reportedly are available or that facilitate substantial piracy and counterfeiting” – since it was first published by the USTR in 2006.
The same proved to be true for 2020, as the Notorious Markets list once again name-checks Amazon sites. The company’s inclusion – alongside 39 online markets and 34 physical markets in 17 different countries – falls neatly in the line with USTR’s increased emphasis on e-commerce.
As the Office of the USTR noted in a release late last week, “The 2020 report includes for the first time a section addressing the role of Internet platforms in facilitating the importation of counterfeit and pirated goods into the United States.” The report, itself, states that “many of those who submitted public comments this year highlighted the complex ecosystem—including domain name registries and registrars, reverse proxy services, hosting providers, caching services, advertisers and advertisement placement networks, payment processors, social media platforms, and search engines—that is abused by providers of pirated content.”
The USTR also asserted in the report that “this year’s review process also identified a continued and growing concern about the proliferation of counterfeits facilitated by social media platforms,” piggybacking on the 2019 Notorious Markets List, which “mentioned increasing concerns right holders expressed with a growing trend of counterfeit products being offered for sale on e-commerce features related to large platforms, such as WeChat.”
Specifically addressing Amazon’s foreign domains, the report cites rights holders’ challenges with “high levels of counterfeit goods,” and concern that “Amazon does not sufficiently vet sellers on its platforms” and that its “counterfeit removal processes can be lengthy and burdensome, even for right holders that enroll in Amazon’s brand protection programs.” (Among those rights holders are members of the American Apparel and Footwear Association, which have been vocal about the “lack of sufficient brand protection measures on Amazon, Facebook, and Instagram platforms” that contribute to the sale of a sizable portion of the growing-number of illicit products in the market).
Beyond that, the report asserts that “as the scale and sophistication of counterfeiters have continued to grow and evolve over the years, right holders indicate that Amazon should commit the resources necessary to make the brand protection programs scalable, transparent, and most importantly, effective.” However, “on a positive note,” the USTR states that in 2020, Amazon partnered with the U.S. Government’s National Intellectual Property Rights Coordination Center on a joint operation to prevent counterfeit goods from entering the U.S. in an effort to protect American consumers.
Reflecting on this year’s list, USTR Robert Lighthizer stated in a release, “Today, the greatest risk of importation of counterfeit and pirated goods, harming both U.S. content creators and U.S. consumers, is posed not by foreign flea markets and dark web sites but by inadequate policies and inadequate action by e-commerce companies that market and sell foreign products to American consumers.”
“This activity harms the American economy by undermining the innovation and intellectual property rights of U.S. IP owners in foreign markets, and it harms American consumers as well,” the release states. “An estimated 2.5 percent, or nearly half a trillion dollars’ worth, of imports worldwide are counterfeit and pirated products.”
Inclusion on the USTR’s list does not carry any direct penalties, and instead, is used to encourage foreign entities and nations to crack down on piracy and counterfeiting. Nonetheless, being name-checked on the list is generally considered to take a reputational toll in the individual company, particularly for the likes of Amazon and Alibaba, for instance, which have been steadfastly working to shed perceptions that their websites are riddled with fakes – a key to gaining bigger customer bases and traction among potential brand partners, while also taking market share from global competitors.
As for Amazon, in particular, a spokesperson for the company said in response to the 2020 list, “Including Amazon in this report is the continuation of a personal vendetta against Amazon, and nothing more than a desperate stunt in the final days of this administration.” Amazon d”oes more to fight counterfeit than any other private entity we are aware of,” the statement further states, noting that “Amazon has and always will be a trusted place to shop for authentic products.”