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Is China Starting To Crackdown On Alibaba's "Illegal Operations"?
It appears the Chinese government has decided it is time to remind the nation's richest man (and millions of retail investors in America) who is in charge. According to a report released by the Chinese government - citing closed-door meetings in July 2014 that were kept quiet so as not to affect the September IPO - there are at least 19 problems with Alibaba's various platforms. As Bloomberg reports, Alibaba failed to properly oversee merchants and allowed the sale of counterfeit products on its e-commerce platforms, according to a Chinese government report. The report concludes, rather ominously, "Alibaba not only faces the biggest credibility crisis since its establishment, it also casts a bad influence for other Internet operators trying to operate legally." While Alibaba has tried to clean-up its image, the report cites issues with counterfeit goods, merchant screening, false advertising, and lax controls.
The report is extensive... (and can be found here)
- *CHINA GOVT RELEASES INSPECTION WHITE PAPER ON ALIBABA:PEOPLE.CN
- *ALIBABA SALES PLATFORM HAS ISSUES: CHINA GOVT PUBLICATION
- *CHINA GOVT IDENTIFIED 19 PROBLEMS WITH ALIBABA PLATFORMS
- *ALIBABA'S TAOBAO HAS UNREGISTERED MERCHANTS: GOVT PUBLICATION
- *ALIBABA LACKS CENSORSHIP ON PRODUCTS SOLD ON PLATFORMS: PAPER
- *ALIBABA PLATFORMS HAVE RIGHT-INFRINGING PRODUCTS: GOVT PAPER
- *ALIBABA LACKS SUPERVISION ON PRODUCTS SOLD ON PLATFORMS: PAPER
- *ALIBABA ONLINE PROMOTIONS VIOLATE RULES: GOVT PAPER
- *ADVERTISEMENT VIOLATIONS FOUND IN STORES ON ALIBABA: PAPER
And then there's this...
- *ALIBABA, CHINA SAIC HOLD CLOSE-DOOR MEETING JULY 16 2014
- *ALIBABA, GOVT MEETING HELD CLOSE-DOOR NOT TO AFFECT CO.'S IPO
Alibaba Group Holding Ltd. failed to properly oversee merchants and allowed the sale of counterfeit products on its e-commerce platforms, according to a Chinese government report.
Many merchants didn’t apply for a business license and misled consumers during holiday promotions, including the Nov. 11 Singles’ Day, according to a document published by a media outlet run by the State Administration for Industry & Commerce.
A meeting was held in July, though the report wasn’t published until now to avoid affecting Alibaba’s initial public offering, it said.
“For a long time, Alibaba hasn’t paid enough attention to the illegal operations on its platforms, and hasn’t effectively addressed the issues,” the report said. “Alibaba not only faces the biggest credibility crisis since its establishment, it also casts a bad influence for other Internet operators trying to operate legally.”
The report from the government cited perceived flaws in its customer
feedback system, false advertising and lax controls by Alibaba staff.
Alibaba wasn’t stringent enough on merchant screening and there are
flaws in its internal credit-scoring system, the report said.
* * *
Alibaba has promised to clean-up...
- *ALIBABA PLEDGES TO IMPROVE MANAGEMENT: GOVT PAPER
- *ALIBABA TO ADD SPENDING TO CLEAR COUNTERFEIT PRODUCTS: PAPER
Alibaba has worked to get rid of counterfeits as it expands internationally, with 90 million listings for products that breached intellectual-property rights removed before its record $25 billion IPO in September. The crackdown is part of Alibaba’s plan to build its reputation now that it is Asia’s largest technology company with a market value of $254 billion.
In December, Alibaba said it spent $160.7 million from the beginning of 2013 through November to block counterfeit products and boost consumer protection.
* * *
Is Jack Ma the next to be taken down by the corruption probe? We doubt it, but when you're the richest man in the country, it would appear a rather large target is painted on your back.
Full Chinese Government Policy Response to Alibaba "problems" here
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Most of this was exposed in the late 2000s and it didn't change anything.
Desperate times call for desperate measures.
I never liked the guy anyway...
Wait, hold on:
"...allowed the sale of counterfeit products on its e-commerce platforms"
You can not be serious? In China? Getthefookoutofhere...
China?
Ali's questionable activities are the reasons the HK stock exchange would not list it, esp since Ma refused to explain/answer their questions, I read somewhere.
His corp smelled fishy to them.
The primary reason is HK was unwilling to bend the rules on coporate governance to accomodate Alibaba's founders share structure. Whereas that bastion of capitalism the NYSE was happy to oblige.
Yet, we have the gall to lecture the rest of the world about corporate governance.
The power establishment in the US thinks these things go unnoticed. But they most certainly do not.
kind of like the "war on terror"...the "war on drugs"...campaigne reform...
oh Ma Ma I'm in fear for my life..
it's all BS
ali sells same quality than eu / usa for 10% the price, fuck you. the reel problem is your fucking 90% marging. go to hell.
WB7:
What specifically in the share/capital structure did Hk not like?
Couple hundred pounds of elephant tusks and a few bags or tiger penises should be legal in China!
Oh, come on. It's fucking CHINA for Christ's sake. Jack's going to dig a few tens of millions out of his pocket, hire a few ruling party relatives on the payroll and this will all be over with.
Corruption. Give me a fucking break. Like they give a shit. The only corruption they care about is lack of payoffs to the party. Which will quickly be remedied.
Came here to say that. The government got their game plan ready to soak him, sat on it long enough to get the money rolling in, now they're coming for their cut. Protecting western brands has nothing to do with it.
Readers might find it ironic that "Ali Baba" is a generic slang term used in the Middle East for "bad guy".
The term comes from the fable 'Ali Baba and the Forty Thieves'.
When non-English speaking Arabs want to point out terrorists, criminals, and assorted scum to US troops
they point and yell, "Ali Baba! Ali Baba!"
Just sayin....
Jack Ma's face reminds me of that 80's movie, Mask.
Jack Mask
Ali Baba and forty thieves
BABA is a VIE, not an ADR, know the difference
I was all Set to buy into that IPO, but then there was this little Kitten that needed an Operation...
When doing business in China - you ALWAYS have to consider the PARTY and the GOVERNMENT. They do not give a shit about jobs, payoffs to particular politicians, money, or image. It is about power and control. They have it, and you DON'T.
Sino Forest was just unfortunate to have been found out.
This guy does the huge IPO of BABA using some screwey offshore structure to evade foreign ownership restrictions - buyers got no real ownership of Chinese operating entity - and then a few months later needs to sell a big bond offering. This deal has all appearance of some badly bogus features. I am able to resist the bait.
OMG! or in Mandarin:
Sum Ting Wong,
Wi Tu Lo,
Ho Lee Fuk,
Bang Ding Ow.
Actually names similar to those would all be in what you call Cantonese, those are southern names, not from Wu, Jin or Dongbei...
Alibaba sells Krugerands at a big discount, only $2.
ASEs too.
http://www.alibaba.com/product-detail/USA-custom-made-silver-coins-ameri...
"Alibaba not only faces the biggest credibility crisis since its establishment, it also casts a bad influence for other Internet operators trying to operate legally." - .GOV
Translation:
"PAY ME."
I have been saying for years to stay away from this garbage site, selling noting but knock offs and toxic trash. Only in China and the US can a guy selling shit become a billionaire!
Watch Amazon stock plummet. Most PL and Amazon get their shit from this site.
Remember Jack Ma's words on US TV after the IPO: " To our investors I would like to say: Trust Me! " ....
Amerika is wonderful - pity its run by whores
Alibaba's CEO has a face only a pencil sharpener would love.
lol, taobao is awesome, most here have no idea what the hell they are talking about.
It's like having a big target on your back, this sucess at any price.
http://www.ft.com/cms/s/0/3c7e71e2-7900-11e4-b518-00144feabdc0.html#axzz...
(Targets available, $1,69 per thousand, Target (canada) price on request)
I get all my pamp/credit suisse gold bars on alibaba. They are a bargain at $16 per troy oz with certificate. The French gold angels are a real sweet deal as well.
/sarc
I wonder if their financials are like their goods: Gold plated 1 oz tungsten bars in APMEX packaging direct from Alibaba = http://www.alibaba.com/product-detail/tungsten-APMEX-gold-bar-in-assay_1...