Exclude 'Small' Sellers? Senators Press Lazada on Fake Health Products

Pressed by senators on the dangers of fake drugs and health products, especially during the pandemic, e-commerce giant Lazada said it could exclude "small" sellers or shut its food and drug category.

Fake Lacoste shirts are unlikely to give skin disease to the wearer, but fake drugs will, Sen. Pia Cayetano told Lazada CEO Ray Alimurung during a hearing of the Senate Committee on Trade, Commerce and Entrepreneurship.

Pirated videos can be forgiven, said Sen. Sherwin Gatchalian, but for health products, "There is a chance for consumers to buy these things to the detriment of their health." Online marketplaces are "not doing enough" to address counterfeit, he said.

"We will probably have to go to a direction where no small seller can list on our platform or the food and pharmaceutical category will be deactivated," Alimurung said. Gatchalian had also pressed the Lazada CEO on diet supplements sold on the platform despite being banned by the FDA.

Lazada is taking the senators' concerns seriously, Alimurung said, adding "We would like to brainstorm with your body... on how we would do it because there is a practicality aspect."

Some 50 million products are sold on Lazada and AI helps sort fakes, Alimurung said. Brand owners are enrolled in the portal, he said.

"It is not for lack of doing things... It's just a matter of us trying to do better mouse traps when these guys try to develop better mice," Alimurung said. "The alternative is to potentially just close down everybody, but we feel that would do more harm than good," he said.