• How to Report Trade Disputes & IP Violations to Alibaba

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    Alibaba trade dispute

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    Asia Import Platform: General Products

    What do you do when a deal with an Alibaba.com listed supplier goes wrong? Perhaps you’ve received the wrong product. Maybe it’s damaged. Or, perhaps, you didn’t even receive any goods at all?

    And, not to forget, what if you find your custom designed or private label product listed on Alibaba?

    In this article, you will learn how to file a dispute on Alibaba.com and (hopefully) get your money back. But, you can only win a dispute if you have the evidence that Alibaba must have to decide in your favor.

    Keep reading, and learn how to how win supplier disputes if you receive poor quality or damaged goods – and how to report intellectual property violations.

    What counts as a trade dispute?

    Many situations fall within Alibaba’s definition of a trade dispute. A few of the most common follow below:

    • The products are defective or damaged
    • The products are not as described (i.e., design, colors or functions)
    • The products were never delivered

    However, many disputes are not about defective, damaged or incorrect items all. Many, if not most, trade disputes relates to quality or product compliance – something that makes it very hard for Alibaba.com to act.

    Alibaba.com cannot act based on the buyer’s perception of good quality. Hence, a dispute can only be won if the buyer can prove that the supplier failed to deliver a product matching the description.

    Types of Alibaba disputes

    In recent years, Alibaba.com has implemented eCommerce and online payment functions directly into its supplier directory platform.

    That said, many importers only use Alibaba.com for supplier sourcing and initial communication. As such, the transaction takes place outside of Alibaba’s platform, and can therefore not be tracked or monitored by them.

    When you report a dispute on Alibaba, you will need to choose between 3 categories:

    • Trade assurance disputes
    • Wholesale order disputes
    • Offline order disputes

    Depending on the setup, the procedure looks very different.

    a. Trade assurance and wholesale order disputes

    Alibaba has two separate trading systems within its platform:

    1. Trade Assurance: Mostly used for products that are made according to buyer specifications (i.e., custom designed and/or private label products). The Trade Assurance program is based on a procedure that is followed by both the supplier and buyer.

    For example, the buyer and supplier must sign a sales contract, and a third party inspection company must verify the quality of the products.

    The payment can be made outside of Alibaba’s own payment platform (Alipay). However, the buyer must pay directly to the supplier’s bank account approved by Alibaba.

    If not, the payment cannot be linked to the supplier that is covered by the Trade Assurance program.

    That said, the process and paper trail is still within Alibaba’s platform, giving them access to the information they need to resolve a dispute – and offer compensation based on the trade assurance terms.

    2. Wholesaler Orders: Some suppliers offer ready made goods (or wholesale products) directly on Alibaba.com. Wholesale products can be ordered directly on the site, and the payment is processed by Alibaba.com. Hence, the transaction can be easily tracked by Alibaba.com.

    You need to provide less evidence when placing an order within Alibaba’s own platform, something that they encourage you do to.

    As Alibaba has access to the product description and payment details, they can make a faster and more accurate decision when you file a dispute.

    b. Offline (non-Alipay processed) trade disputes

    You can still file a dispute, even if the transaction takes place outside of the trade assurance program or its payment system. As mentioned, it is likely that the vast majority of orders facilitated through Alibaba.com takes place ‘offline’.

    Filing such a dispute is more complicated, and requires that you can prove that the supplier did fail to comply with the product description.

    Alibaba.com cannot monitor the communication between the seller and buyer, that takes place outside of its platform. Neither can they check the product description, and assess whether the supplier did send defective products – or items that are not as described.

    Thus, it is up to the buyer to upload sufficient evidence, supporting the claim. Alibaba.com cannot possibly decide in the buyer’s favor on their word alone.

    How to win a trade dispute on Alibaba

    We have received countless emails and comments from disgruntled buyers, claiming that Alibaba.com failed to act in their favor – even though the supplier delivered a poor quality product.

    A few examples follow below:

    a. The items had the wrong fabrics and colors

    b. Machinery without the correct labeling (for usage in the United States)

    c. The product is perceived as low quality by the buyer

    Alibaba cannot act on the buyer’s perception of ‘good quality’, or their assumption that the supplier would be fully aware of all applicable safety standards and labeling requirements in the United States.

    In order to win a trade dispute, you must be able to show that the supplier did fail to provide a product, matching the written and clearly defined product specifications.

    For example, you need to provide the following when you file a dispute:

    a. Product specification sheets

    b. Design drawings and images

    c. Sales contract

    d. Transaction records

    e. Images and video showing the defective / wrong items

    f. Quality control and lab testing reports

    Based on the documents presented above, Alibaba.com can decide if the supplier is at fault. Without documentation and other evidence, they simply cannot act.

    The issue, however, is that many buyers don’t even consider sales contracts and quality inspections until after a situation comes up. But, by then it’s already too late to do something about it.

    That is also something that we are trying to change, with our Starter Package. When you sign up, you will get access to tutorials, interactive task lists and videos (a complete roadmap) that guides you step by step through the entire process:

    1. Draft product specification

    2. Identify qualified manufacturers

    3. Develop samples and tooling

    4. Sales contract, payment, quality control and production

    It is especially in Part 4 that you will prepare the documentation that you need to file a dispute, if the situation ever comes up. The good news is that you will most likely never get there, as most suppliers do a good job – as long as you work on their terms and provide them with clear instructions.

    To further simplify the process, you will also get access to a set of document templates (i.e., product specification template, quality checklists and sales contract) and label files.

    But, if you ever do have to file a dispute, you will at least have the documentation you need to support your case.

    Yet, at the end of the day, Alibaba’s dispute filing system is one of many tools to use if something goes wrong. It’s not a perfect backup solution, or warranty, whenever you run into trouble with your suppliers or products.

    Reporting intellectual property (IP) violations

    Quality and compliance issues are not the only things that keep business owners awake at night. Intellectual property infringement is a constant worry for buyer’s, importing goods from Asia.

    Many suppliers use their product catalog, on Alibaba.com and Globalsources.com, as a digital showroom, for products they have manufactured for other companies.

    That said, a supplier will not necessarily sell a product, simply because they put it up as a product listing. Most suppliers hardly see it as IP theft, as they only consider it as a demonstration of what they can make for other customers.

    I few years ago, that happened to one of our customers in the UK. Just days after their packaging supplier had completed the gift box sample for their new collection – it was listed in their product catalog.

    Our client was not amused when they, by chance, found their branded jewelry box listed on their Alibaba page.

    Luckily, it didn’t take more than a phone call to make the supplier realize they made a mistake.

    Like many other suppliers, the factory did not once consider this as an attempt to counterfeit the brand or even design. It was only a demo product, and they took the listing down in a matter of minutes.

    Contrary to popular belief, Chinese manufacturers are not constantly looking for brand names to steal and designs to replicate. In most cases, minor IP violations can (and should) be resolved with a friendly phone call.

    Hence, in most cases it is not even necessary to file an IP violation complain to Alibaba.com.

    But what if your design or brand shows up, and the supplier outright refuse to take it down?

    Alibaba you to file an IP violation report online, via its Aliprotect system. You can, for example, report the following types of IP violations:

    a. Images of your product

    b. Products are violating your brand name/s

    c. Products are violating your design and/or utility patents

    As always, Alibaba.com can only act based on evidence. Depending on the nature of the IP violation, you may need to provide the following:

    a. Trademark documentation

    b. Patent documentation

    c. Product images / documentation

    d. Proof of identity (i.e., passport, ID and company documents)

    e. The URL to the product that violates your IP (must be listed on Alibaba)

    Suppliers are wise to take IP theft reports seriously, as they can result in account suspension or even a termination of the service agreement.

    At a minimum, a successful report results in a listing removal, and possibly a warning.