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US slams Baidu, Taobao for piracy

US trade officials have named and shamed Chinese search engine Baidu and e-commerce giant Taobao as "notorious markets" for counterfeit and pirated goods.

The decision may add to calls for legislation giving US courts new authority to block foreign websites that sell pirated goods from operating in the US.

The Chinese IT pair is among more than 30 Internet and physical markets around the world listed Monday by the Office of the US Trade Representative (USTR) in an annual review. Ten of the blacklisted markets are from China.

"Piracy and counterfeiting undermine the innovation and creativity that is vital to our global competitiveness," USTR Ron Kirk said in a press release Monday.

"The review … highlights an opportunity to work together with our trading partners to curb illicit trade and expand legitimate commerce in creative and innovative industries," Kirk said.

Baidu and Taobao acknowledged the listing but refused to provide further comment Tuesday.

A spokesman for Alibaba, the owner of Taobao, John Spelich, said in a written statement, "We will continue to work closely with brand owners and others to further enhance the level of trust and integrity in our online marketplaces for the benefit of all our stake-holders," according to the Wall Street Journal.

USTR said Baidu's online services engaged in "deep linking," providing links to online locations that carry the infringing materials.

Baidu, a Nasdaq-listed search engine, was recently ranked as the most visited site in China, and among the top 10 in the world.

Taobao, one of the world's 15 most visited sites, must still address fundamental problems in allowing access to illegal goods though its website, despite its existing efforts, the USTR said.

A Taobao employee who spoke on condition of anonymity said the company had established a unit staffed around-the-clock to filter fake product information on its website.

However, the monitoring principally relied on an automatic filter and consumer complaints, the source said.

A Global Times report in January found that Taobao had been selling hacked iTunes accounts at prices ranging from 1 yuan to 200 yuan ($29.80).

Fangnaier, a Guangzhou-based underwear manufacturer, sued Taobao and three online shops registered at the website in December for counterfeiting its products, involving more than 4,000 shops on the website, reports say.

Last month, Alibaba's chief executive and chief operating officers resigned over a probe that found evidence of mass defrauding of consumers.

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