Alibaba agrees to block sales of dangerous toys in the US

Clare Baldwin and Adam Jourdan

HONG KONG – Chinese e-commerce company Alibaba Group (BABA) has agreed to prevent the sale of up to 15 illegal or dangerous toys in the United States, the chairman of the U.S. Consumer Product Safety Commission announced Tuesday.

This is the first such agreement between CPSC and a foreign company, CPSC chairman Elliot Kaye said on the sidelines of the Hong Kong Toys and Games Fair.

“We are excited to push our boundaries and collaborate with whomever we need,” Kaye said. However, the contract is unenforceable.

%VIRTUAL-WSSCourseInline-963%CPSC will provide Alibaba, the world’s largest e-commerce company, with a list of five to 15 children’s toys it wants to prevent from reaching the U.S. market. According to the commission, about 90 percent of toy imports into the U.S. come from China.

Alibaba’s chief corporate officer, Jim Wilkinson, said in a statement that the company would “work with the CEO and his team to do everything possible to protect consumers.”

Alibaba, which handles more e-commerce than U.S. companies Amazon.com (AMZN) and eBay (EBAY) combined, controls as much as 80 percent of China’s e-commerce market. Its initial public offering last year is the world’s largest at $25 billion.

The CPSC has not yet contacted China’s JD.com (JD) or other overseas e-commerce sites, Kaye said, but added: “It’s coming soon. If we think it’s a viable place to go, we’ll go there.”

Critics say Alibaba’s size makes it difficult for police to track.

“Alibaba has talked about removing all defective products from (e-commerce platform) Taobao, and that’s probably a much bigger demand than can be met,” said James Feldkamp, ​​CEO and co-founder of Chinese consumer organization Mingjian Group.

He added that the agreement could, however, help Alibaba from an advertising perspective.

“What it says is, ‘We’re not going to go around everywhere and inundate the U.S. with a bunch of counterfeit junk. We are another legal channel of communication with American consumers,” he said.