Webinar Transcription Josh Halpern: Welcome, everybody to another version of “Conversations from the Field – China.” We’re here with Tony Shan from Alibaba, talking about protection in marketplaces. Tony, can you describe your role at Alibaba? Tony Shan: My name is Tony Shan. I’m the head of Tmall Global & Kaola for the Americas Region, part of Alibaba Group. Tmall & Kaola are the two largest B2C cross-border ecommerce platforms in China. Josh Halpern: There’s a lot of discussion around protecting your IP when you’re selling on a marketplace especially in China. How does Alibaba help protect your IP? Tony Shan: Yeah, I think the IP … it’s always the hot topic. It’s also top of mind for a lot of American brands looking into selling into China. I would say that IP protection as a whole within the Chinese market has improved a lot over the years. That is also due in part from a consumer perspective. More consumers are buying global brands. Authenticity of these global brands are key. So, as a platform and also as the Alibaba Group, we have multiple platforms within our portfolio. We want to be able to protect, not only the brands, but also the consumers as well. So, we do have this Alibaba IP Protection Portal, where from a brand perspective, you see counterfeits or illegal activities within any of our marketplaces, that’s a resource for brands to get more information and also submit disputes as well. In terms of our Alibaba IP Protection Framework, you can see we have this notice and takedown mechanism within this protection portal where we will review all of the listings that has been raised as red flags to evaluate if it violates any IP infringements. We also have AI, Artificial Intelligence, in our backend system that is proactively monitoring all of our listings within our B2C and B2B platforms and taking down IP infringements there. We also cooperate heavily with law enforcement within China. And we have been working with local law enforcement within domestic China to close down businesses and factories that have been violating IP protections. And then, lastly, we work with various stakeholders, especially with the brands, we collaborate with them to make sure that we’re protecting the brands and we’re also protecting our consumers who are buying these products within our platform. And then, just in terms of the scope of IP protection, I just want to make some clear delineations, the things that IPP protection that we cover is from a trademark, patent, and copyright infringement. This does not cover distribution channel management and price control within these marketplaces. So, that is also part of the stakeholder collaboration that we do, that we work with the brands to figure out what’s within our scope that we can help protect and then what else from a brand’s perspective they can do to help clean up the marketplaces. Josh Halpern: Thank you, Tony. One of the things that we’re seeing is a lot of companies complain and they say, “Well, my IP has been infringed upon in China and Alibaba, and Tmall, etc.” And what do you say to companies who say, “China doesn’t care and Alibaba doesn’t care about my IP”? Tony Shan: I would say we definitely do care. Again, we want to have long-term business relationships with all of the brands that we work with. And then our platform also has a customer-first approach as well. So, we want to protect our consumers as well as we don’t want them to buy fake goods because if they come to our platform trusting us to sell them authentic global brands, so we also want to provide that assurance to them. In terms of potential infringements within the platform and the marketplaces, we do take this very seriously. We do take every red flag seriously as well. So, we’ve worked with brands to figure out what is within our control that we can do and what’s within the brand’s control, and how together we can make this a safer shopping environment for all. Josh Halpern: I remember meeting with some of your team on the IP group in Beijing years ago, and I was impressed with the number of people staffed to handle this. What I think is lost in terms of the U.S. perspective is the sheer magnitude of infringement and the magnitude of efforts you have to put on that. Could you explain a little bit more about what the scope is here? Tony Shan: We have specific teams on IP, both here in the U.S. and also within China and within each of our platforms within that ecosystem that is looking at IP very closely. We have technology as well, the AI that I mentioned, to proactively do takedowns as well that is running within our platforms on a daily basis. So, between real people looking at IP and also technology, we want to make sure that we’re covering all channels and also all of the marketplaces that we do have. Josh Halpern: What I understand is essentially we’re talking about playing whack-a-mole, but you still have to be engaged. You have to keep taking these down, you have a form that you fill out, and I presume it includes demonstrating that you are the licensed distributor or the brand owner, if you can demonstrate that, yeah, you’ll help take it down. Tony Shan: Yes. And again, I do want to just make the delineation that if it’s straight, like copyright infringement, meaning that they copied your design or your product and just changed the label, those are the ones that’s within our scope. Let’s say you have an unauthorized seller that is selling your product, but it is your product, that is the part of the distribution channel management that it’s not within our IP protection framework. Josh Halpern: That’s fair. Tony Shan: Something that we work with the brands to figure out is the best way in terms of controlling the distribution on the brand side as well. Josh Halpern: Thank you for that delineation though. That is really helpful. Tony Shan from Alibaba, talking about IP. Thanks a lot for joining us. Tony Shan: Thank you so much.