Taiwan has given Chinese mainland e-commerce giant Alibaba Group Holding Ltd six months to wind down its online marketplace taobao.com's operations on the island after it failed to apply for the permit required for a mainland company to do business there, Taiwan authorities said on Monday.
An official at Taiwan's Investment Commission said a fine of NT$240,000 ($7,896) has also been imposed on taobao.com in what is the second case of an Alibaba operation falling foul of the permit rules for mainland companies this year. In March, alibaba.com was told to leave Taiwan within six months and fined NT$120,000 for a similar reason.
While the fine is small and shoppers in Taiwan can continue to order goods via taobao.com's mainland base in future, the permits glitch is an unwelcome headache for Alibaba as its seeks to grow business outside its mainland base.
Mainland companies registered in other countries and regions need to apply for mainland business permits in Taiwan, Investment Commission executive secretary Emile Chang said. "Neither alibaba.com nor taobao.com have done so."
Chang said both taobao.com and alibaba.com, Alibaba's business-to-business online platform hit by a similar ruling earlier this year, had applied for regular licenses to operate in Taiwan as non-Chinese, foreign-owned firms. Alibaba.com has a registration in Singapore, while taobao.com has a Hong Kong registration.
He noted the companies could still apply for Chinese mainland-owned company permits and potentially maintain operations in Taiwan.
In a statement provided via its Taiwan taobao.com site, Alibaba said it is "having positive ongoing discussions with the relevant Taiwan authorities... We hope to find a suitable way forward in order to continue to serve the needs of Taiwan consumers and merchants."
Meanwhile, responding to allegations that Alibaba has been allowing counterfeit goods on its websites, Ni Liang, who runs the firm's anti-counterfeiting operations, said brands could crack down on the counterfeit trade better if they talked to Alibaba instead of suing it, Reuters reported Monday.
On Monday, Alibaba joined with the South Korean government to open an online store on Alibaba's business-to-customer marketplace tmall.com enabling Chinese consumers to purchase goods from South Korea more conveniently, according to a press release e-mailed to the Global Times by Alibaba.
