In a letter addressed to Ambassador Froman (United Stated Trade Representative) the Association claims that Taobao is one of the largest platform used to market counterfeit goods. According to the AAFA their members witness this situation on a daily basis, and this results in millions of dollars of lost sales, damage to reputation, legal costs, and exhaustion of internal resources.

The Association stresses the frustration in fighting this situation, notwithstanding the fact that USTR (Office of the United States Trade Representative) has removed Taobao from its Special 301 Notorious Market list in 2012 as it signaled ongoing concerns over the widespread availability of counterfeit apparel and footwear on the site. The same entity has declined to relist Taobao in the 2013 and 2014 reports.

AAFA believes this should be a strong message for action but also claims that since Taobao was delisted, the problem of counterfeit apparel and footwear on the site has worsened, and listed the following problems resulting from the situation:
• Lack of clarity or consistency in documents necessary to effectuate a take-down
• Long delays before take-downs are executed
• A weak punishment system
• Lack of cooperation with local law enforcement
• Lack of enforcement for Copyrights and Trademarks
• Lack of trust by Taobao in brand owners’ take-down requests
• Taobao acting as both judge and jury in determining whether a take-down request is justified

The American Association recognizes that both Alibaba and the Association have been working closely in the last year, however, the frustration on the American side can be attributable to the “the slow pace has convinced us that Alibaba is either not capable of or interested in addressing this problem”.

In declarations to the World Footwear, the AAFA said: “Counterfeit products cost our members 68 billion US dollars in 2013 and as mentioned in the letters, AAFA members encounter innumerable counterfeits on Taobao every day. Despite numerous conversations with Alibaba over the last year, we have yet to see tangible progress toward addressing counterfeits on the site. The letters sent to USTR and the SEC asks them to use their oversight authority to put pressure on Alibaba to take action. Alibaba has publicly made comments that it is committed to addressing counterfeits – we’d like to see that translate into action.”

When questioned about the importance of the Chinese marked for the footwear industry in the US the Association was very clear: “China is an important market for us, and one we will continue to work with and serve. That does not mean we will tolerate the theft of our brands’ intellectual property.”