Amazon Lands on U.S. Trade Representative Notorious Markets Blacklist

The Office of the United States Trade Representative released its annual Special 301 Report on the adequacy and effectiveness of trading partners’ protection of intellectual property rights and the findings of its Review of Notorious Markets for Counterfeiting and Piracy (the Review), which highlights online and physical markets that reportedly engage in and facilitate substantial trademark counterfeiting and copyright piracy.

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The United States Trade Representative (USTR) is part of the Executive Office of the President. Through an interagency structure, USTR coordinates trade policy, resolves disagreements, and frames issues for presidential decisions.

The Review of Notorious Markets for Counterfeiting and Piracy highlights 38 online markets that continue to include Alibaba Group’s Taobao, Russian social media site V.K., among a list of dubious online sites that offer illegal downloading of music and movies.

Most online marketplaces mentioned are in countries with lagging intellectual property rights rules or enforcement or are sites that mask their actual location.

However, this year’s list includes a major surprise as Amazon’s marketplace platforms in the U.K., Germany, France, India and Canada have been listed as “notorious markets” in the report.

The USTR Allegation Against Amazon

“Right holders expressed concern that the seller information displayed by Amazon is often misleading such that it is difficult for consumers and right holders alike to determine who is selling the goods and that anyone can become a seller on Amazon with too much ease because Amazon does not sufficiently vet sellers on its platforms.”

“They also commented that Amazon’s counterfeit removal processes can be lengthy and burdensome, even for right holders that enroll in Amazon’s brand protection programs.”

“In addition, as the scale and sophistication of the counterfeiters have continued to grow and evolve over the years, these right holders indicate that Amazon should commit the resources necessary to make their brand protection programs scalable, transparent, and most importantly, effective.”

“More specifically, they ask that Amazon take additional actions to address their concerns, including by collecting sufficient information from sellers to prevent repeat infringers from creating multiple storefronts on the platforms, making detailed information about the real seller of a product obvious to consumers and right holders, being more responsive to complaints of counterfeits by right holders, and being more proactive in preventing counterfeit goods from appearing on the platform.”

Amazon’s response to the inclusion of its foreign marketplaces on the USTR Notorious Markets List is, “This purely political act is another example of the administration using the U.S. government to advance a personal vendetta against Amazon.”

Trump vs. Bezos

The Trump Bezos feud has been legendary fodder for the media going back to Trump’s campaign days in 2015.

Before the USTR report came out, it had flared up again a few days ago about the U.S. Postal Service with Trump claiming USPS is losing money on every Amazon delivery.

Jeff Bezos is also the owner of the Washington Post, which has been at the forefront of stories and op-ed pieces critical about the Trump Administration.

Including five of Amazon’s foreign marketplaces on the USTR notorious markets list will only add fuel to the fire.

However, it should be noted the Notorious Markets List (NML) originates from the Federal Register Request for Public Comments about intellectual property issues and is located at https://www.regulations.gov.

USTR develops the NML in coordination with the federal agencies represented on the Special 301 Subcommittee of the Trade Policy Staff Committee (TPSC).

Mostly, the NML carries no legal weight on companies or countries included.

However, major corporations, especially American-owned corporations or those that operate in the U.S., are not particularly keen to end up on the NML as it highlights the companies in a negative light.

Many Amazon Sellers Don’t Trust Amazon

Amazon sellers have been distrusting of Amazon regarding Intellectual Property (I.P.) rights for a very long time. There even have been allegations that the company’s private-label group is using seller data to produce competing products that may skirt I.P. rules.

Therefore, including five of Amazon’s foreign marketplaces on the NML just adds to the distrust many sellers have about the company’s operations and transparency.

However, since many products from marketplaces sellers perform very well on the platform, it entices sellers to return to the marketplace, despite real or perceived misgivings about the company.

While Amazon can push back against the NML inclusion claiming a political vendetta by the President, Congress has been investigating the company on different but related issues.

A lack of trust and transparency has drawn the ire from both sides of the aisle. Amazon’s inclusion on the USTR NML is not going to help its standing in Washington.

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