Snapdeal, one of India's largest e-commerce companies, along with four Indian shopping complexes have figured in the US' 2020 edition of the Notorious Markets List for counterfeiting and piracy.
Other than Snapdeal, the four markets are Tank Road in Delhi, Heera Panna in Mumbai, Kidderpore in Kolkata and Millennium Centre in Aizawl.
In all, the US Trade Representatives' (USTR) annual list has 38 online markets and 34 physical markets that are reported to engage in or facilitate substantial trademark counterfeiting and copyright piracy.
"Snapdeal, one of India's largest e-commerce platforms, is known as a place to purchase counterfeit watches and shoes," the USTR said.
According to a November 2018 survey, 37 per cent of its customers reported that they had received a counterfeit product from Snapdeal.
SnapDeal has since responded to the USTR report, saying it is factually incorrect and that it reflects a limited understanding of the business models of online marketplaces.
“The report released by USTR seeks to cast aspersions on many of the world's leading online marketplaces, including Amazon, Pinduoduo, Shopee, Snapdeal, Taobao, Tokopedia and many more. The report is based on a limited understanding of the business models of online marketplaces and ignores the roles and responsibilities of intermediaries under law in various jurisdictions with respect to each of the models. Further, the process of collating such inputs by the office of the USTR is neither objective nor inclusive," a Snapdeal spokesperson said in a statement.
"The comments made in the report in respect of Snapdeal are factually incorrect in most aspects, are based on unverified inputs and are defamatory in nature. We firmly disagree with the 'findings' of the report and specifically in its observations relating to Snapdeal."
"The report also ignores the extensive and on-going efforts by various marketplaces to collaborate with brands towards the protection of intellectual property on online marketplaces. As India's third-largest marketplace, Snapdeal operates a robust anti-counterfeit program—Brand Shield—that enables easy reporting and takedown of listings of counterfeits and delisting of defaulting sellers. It has well-defined measures to verify the identity of sellers based on government registrations. Snapdeal works closely with global and leading Indian brands and with law enforcement authorities to provide information wherever required to support any effort to enforce the legal rights of the brand owners. Snapdeal is also an active member of the International Trademark Association, a global alliance spanning 7,200 members across 187 countries, including large brand owners, small & medium enterprises, government offices, non-profits, among others," said the spokesperson.
Delhi's Tank Road market was in the Notorious Markets List (NML) in 2019. "Right holders confirm that this market continues to sell counterfeit products, including apparel and footwear. Wholesale counterfeit goods are also reportedly supplied from this market to other Indian markets, including Gaffar Market and Ajmal Khan Road (in Delhi)," it said.
The wholesale vendors appear to operate freely, allowing them to build well-established businesses over many years, it said.
The five-storey Millennium Centre in Aizawl is a major market for goods produced in China, Korea, and Thailand, the USTR said.
The report notes that a majority of the clothing and electronic items found at this location are counterfeit, it added.
Heera Panna indoor market in Mumbai houses approximately 140 shops reportedly selling high-quality counterfeit watches, leather goods, shoes, consumer electronics, and cosmetics, the USTR said.
"According to right holders, intellectual property enforcement in this market is very difficult because the market and store owners are well-protected by local authorities and law enforcement," it said.
Locally known as "Fancy Market," Kidderpore reportedly sells counterfeit consumer electronics, apparel, cosmetics, and pirated software and media, often at wholesale quantities, the USTR said.
In its report, the USTR said that the activities of these 38 online markets and 34 physical markets harm the American economy by undermining the innovation and intellectual property rights of the US IP owners.
An estimated 2.5 per cent, or nearly half a trillion dollars' worth, of imports worldwide, are counterfeit and pirated products, it said.
The review does not constitute an exhaustive list of all markets reported to deal in pirated or counterfeit goods around the world, nor does it reflect findings of legal violations or the US government's analysis of the general IP protection and enforcement climate in the country concerned, the USTR said.
