White House official Peter Navarro said online marketplaces, payment processors and customs brokers believe they have “no liability and that simply has to stop.”
President Donald Trump’s memorandum to crack down on illicit traffic in counterfeit goods calls for holding all players within the online marketplace, including third-party payment processors and customs brokers, accountable when wrongdoing occurs.
Peter Navarro, the White House’s director of the Office of Trade and Manufacturing Policy, told reporters during a press briefing phone call Wednesday morning that the online marketplace should consider the memorandum “a warning shot across the bow” that everyone involved in these types of supply chains has a responsibility to combat counterfeit goods trafficking and “if you don’t clean it up, the government will.”
Navarro specifically highlighted Alibaba, Amazon and eBay as conduits for counterfeit goods suppliers to sell their products to unsuspecting American consumers, adding that there’s a more than 40 percent chance that any brand name product bought through these online marketplaces today could be counterfeit. He said this finding was further confirmed by a January 2018 Government Accountability Office investigation into third-party online purchases.
Navarro said the third-party online marketplaces, together with third-party payment processors and customs brokers, believe they have “no liability and that simply has to stop.”
The White House official noted that counterfeiters, as well as opioid sellers, are taking advantage of the $800 de minimis per imported package. Navarro said these small package importers who declare the value of their shipments to be less than $800 aren’t required to provide additional information about their shipments to Customs and Border Protection. He added that the Treasury Department has the authority to address that “loophole,” if necessary.
“There’s not enough Customs and Border Protection personnel to police this type of traffic,” he said.
The presidential memorandum, which was signed Wednesday, calls for improved coordination between the Commerce and Homeland Security departments, Office of Management and Budget, Office of the U.S. Trade Representative and attorney general to counter the rise of counterfeit imports sold online.
“Counterfeit trafficking impairs economic competitiveness by harming United States intellectual property rights holders and diminishing the reputations and trustworthiness of online markets; cheats consumers and poses risks to their health and safety; and may threaten national security and public safety through the introduction of counterfeit goods destined for the Department of Defense and other critical infrastructure supply chains,” the memorandum said.
The memorandum requires within the next 210 days the delivery of a report to the White House that outlines the state of counterfeit goods trafficking and provides recommendations for curbing their importation and sale.
Included in the report will be recommendations for how to strengthen enforcement against traffickers of counterfeit goods. “The report should address the practices of counterfeiters and pirates, including their shipping, fulfillment and payment logistics, and assess means of mitigating the factors that facilitate trafficking in counterfeit and pirated goods,” the memorandum said.