Gov't must restrict e-commerce firms selling fake goods

China must establish a system to record and restrict e-commerce firms that break rules on counterfeit goods, said the chief of the country's commercial regulator on Monday, responding to a question on the sale of fakes on Alibaba Group Holding Ltd's websites. [Special coverage]

The cost of breaking existing rules about selling counterfeit goods online is too low, said Zhang Mao, head of the State Administration for Industry and Commerce (SAIC), at a news conference during China's annual parliamentary session in Beijing.

If punishments are made more severe then the market will improve and fake goods will disappear, Zhang said, adding that e-commerce is growing faster than regulations and laws can keep up, and firms and the government should cooperate more.

Alibaba and the SAIC were engaged in an unusually public dispute in late January over the sale of fake goods through Alibaba, though the regulator's "white paper" which sparked the standoff was quickly retracted.

Here are other highlights of the news conference.

Business system reform

China will continue to reform its business system to ease government regulations for companies and inject vitality into the market, Zhang said.

"Chinese authorities will continue to streamline administration, delegate more powers to lower levels so as to give the market and society more play in economic development, and ease regulations for businesses," the minister added.

China this year will further simplify the process for entrepreneurs to register or nullify their businesses, give companies more decision-making power to choose their business scopes, he said.

"China will also press ahead with the reform of integrating the business license, the certificate of organization code and the certificate of taxation registration into one certificate to ease the registration procedure for companies," Zhang said.