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President Puts Marketplaces on Notice in Counterfeit Crackdown

President Trump
President Trump puts marketplaces on notice in counterfeit crackdown

President Trump is putting ecommerce companies and shipping carriers on notice with the signing of a Presidential Memorandum on Combating Trafficking in Counterfeit and Pirated Goods today.

The President called out third-party marketplaces in citing the dangers and negative effects of counterfeit and pirated goods, but he also called out shipping carriers, payment providers, and vendors.

He called on the Secretary of Homeland Security, in coordination with the Secretary of Commerce, to provide him with a report detailing the issues along with recommendations within 210 days (the end of October).

“The report should address the practices of counterfeiters and pirates, including their shipping, fulfillment, and payment logistics, and assess means of mitigating the factors that facilitate trafficking in counterfeit and pirated goods,” he wrote. And the agencies should “consult with intellectual property rights holders, third-party intermediaries, and other stakeholders” when conducting their research.

One thing the report made loud and clear: the administration wants better data. “Comprehensive data regarding the extent of counterfeit trafficking through online third-party marketplaces are lacking.” And it called for the report to include recommendations on changes to the data collection practices of agencies, “including specification of categories of data that should be collected and appropriate standardization practices for data.”

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President Trump wants the report to include recommendations for more effective detection, interdiction, investigation, and prosecution regarding trafficking in counterfeit and pirated goods, including trafficking through online third-party marketplaces and other third-party intermediaries.

“These recommendations should include suggestions for increasing the use of effective technologies and expanding collaboration with third party intermediaries, intellectual property rights holders, and other stakeholders.”

In describing the scale of the problem, President Trump cited an OECD report that he said estimates the trade in counterfeit and pirated goods to be approximately half a trillion dollars per year, with roughly 20% infringing upon intellectual property belonging to United States enttities.

He also cited a recent Government Accountability Office report that examined four categories of frequently counterfeited goods, and, “based on a small sample of these goods purchased through various online third-party marketplaces, found that more than 40 percent were counterfeit.”

Large brands are sure to be delighted to see the Federal government turn its attention to the problem of fake goods. It’s unclear exactly how the attention will impact marketplaces, payment providers, shipping carriers, and ultimately, US online sellers.

You can find the memorandum on WhiteHouse.gov.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

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