Coupang hit for selling fake luxury goods
Fake Rolex watches are sold on Coupang online / Screen captured from Coupang website
By Kim Jae-heun
The country's top online retailer Coupang has been hit for not properly monitoring the sales of fake luxury products on its platform.
The Korea Watch & Clock Industry Cooperative (KOWIC) filed a claim against Coupang for damages after small- and medium-sized companies suffered from flourishing fake Rolex sales there.
The cooperative body said 684 imitation luxury watches are sold on Coupang and their prices range from 200,000 won to 300,000 won. Prices for an original entry-level Rolex watch start at 10 million won.
“The current law only punishes dealers who sell fake products and not the retailers including Coupang. This system is only hurting small- and medium-sized firms here that are making watches fair and square,” KOWIC wrote in a press release.
KOWIC said local fashion watchmakers selling products in the same price range as the fake luxury watches lost billions of won due to counterfeiting.
“Not only should Coupang ban dealers from selling fakes watches but it should also compensate us for sales losses,” KOWIC added.
The same problem is seen in other luxury fashion categories.
Coupang's online mall also offers imitation luxury bags and wallets. The items are often described as “customized versions” of popular luxury brands. But they come with the same design in similar leather as the original.
This is not a big concern for global luxury brands, as the counterfeits are not sold in the same price range, which doesn't affect their sales.
“We have had this issue for a long time because e-commerce came to the scene,” an industry source said. “The platform just switched from offline to online now. We are starting to see a decrease in demand for fake luxury goods here but I agree that retailers should also be subject to punishment for allowing the trade of counterfeits on their platforms.”
Coupang said it has established a taskforce of some 100 monitors keeping an eye on dealers trading fake luxury items. The online retail giant is also operating an artificial intelligence system to analyze the prices and images of fake items.
Popular luxury goods that are often the subject of counterfeiting will have to be checked by Coupang before dealers sell them online, and the retail giant will see if the items were imported legally.
“We have taken preventive measures by implementing a high-tech system and a special taskforce to eradicate fake luxury goods trading,” a Coupang official said. “However, fake product dealers sell goods by luring customers to contact them on social media, which makes it harder for us to crack down on them.”
A number of dealers upload pictures of fake products and include a message below on the website to contact them on Instagram or KakaoTalk to purchase the items. In this case, they are free from the crackdown because the customers did not purchase the products through Coupang.
“KOWIC does not know about this situation and only condemns us for what they see and believe. They are distorting the truth,” the Coupang official said.
Coupang also pointed out that it was not the only platform embroiled in this issue and the trade of fake luxury goods is more prominent on Instagram, Bungaejangter and Kakao Story.
According to data revealed by the Korean Intellectual Property Office (KIPO), Instagram ranked No.1 for selling the most imitation products between January and October this year, followed by Bungaejangter, Kakao Story and Naver Cafe. Coupang was after Naver on the list.