China to crack down on counterfeit goods

China's State Administration for Market Regulation made an announcement on Thursday to fight against the manufacture and sale of counterfeit or substandard goods, including products that copy famous brands.

The regulator said it would focus on illegal activities such as the infringement, manufacture and sale of counterfeit products and misleading or illegal advertising. It requires a comprehensive investigation from production to sales against key illegal cases. Local regulatory authorities plan to start with online trading platforms or websites to further investigate illegal production and operation in upstream or downstream sources, and will provide clues in time to related local regulatory authorities.

At the same time, the administration is working to urge operators of online trading platforms or websites to fulfill their statutory obligations to safeguard the legitimate rights and interests of trademark owners and consumers, and to cooperate with market supervision administrations for relevant governance. Those who do not fulfill their legal obligations will be investigated and penalized according to the law.

On Wednesday, the State Administration for Market Regulation released an announcement responding to reports about the infringement and counterfeit goods sold on Pinduoduo's e-commerce site, and required the Shanghai Administration for Industry and Commerce as well as other related regulators to launch targeted investigations.

Pinduoduo, China's online group discount platform, debuted on the Nasdaq Stock Market on July 26, with its shares rocketing by more than 40 percent on its first trading day, valuing the company at $29.6 billion. However, troubled by copycat products, the company lost about $5 billion in market capitalization in the following five trading days.