China's e-commerce giant Alibaba is considering adding a classification system to its intellectual property complaints handling mechanism to optimize its anti-counterfeiting measures, following a spate of false complaints from online customers.

Statistics released at a recent seminar in Beijing showed that the platform received more than 20 million IP complaints from online customers last year, although appeals from more than 200,000 sellers, almost half of all appeal filers, were eventually upheld.

The worrying statistic means that over 200,000 online sellers were almost wrongly punished, and it is estimated that 500 million sales were affected by the proceedings.

The company also found that 1,531 complainants, despite being responsible for only 0.59 percent of all complaints, were involved in 80 percent of successfully appealed cases. Alibaba said the high number was because the complaints were made in bad faith.

"Some customers allegedly got refunds by providing fake products when asked to prove that the products they had bought were faulty or had other problems," said Gu Jun, an executive in Alibaba's complaints department.

"The customers submitted their reports using counterfeit identity cards, and at the same time, they contacted the online shops where they bought the products to demand a refund. They told the sellers that they would withdraw their complaints if they received a refund," Gu said. "In other words, they took advantage of our reporting system to demand compensation."

Gu said that such behavior damages both Alibaba and the online stores involved.

Ye Zhifei, chief of Alibaba's IP center, said the platform is planning to classify complaint filers into four categories - high-quality, normal, low-quality and bad-faith, and different handling mechanisms and resources will be applied for each category.

They will also ask complaint filers to provide more evidence, both to protect the rights of online shops and avoid unnecessary disputes, Ye added.

Du Ying, a professor of IP rights at the Central University of Finance and Economics in Beijing, applauded the plan, saying better protection for sellers is a necessity.

Li Shunde, a researcher of law and IP rights at the Chinese Academy of Social Sciences, agreed, saying that immediate measures should be taken to ensure that the online environment is cleaned up and that those who submit fraudulent claims are punished.

Zhang Taolue, a professor at Tongji University, added that the government should play a role in regulating the e-commerce sector, instead of relying on its ability and willingness to self-regulate.

Contact the writers through [email protected]

(China Daily 02/23/2017 page17)