Why marketplaces don't stop counterfeits: the state of online counterfeit distribution in 2026

Online counterfeiting is no longer a black-market problem. On the open marketplaces consumers use every day, such as Coupang, Naver Shopping and 11st, counterfeits sell right next to genuine products. According to a 2025 OECD report, global trade in counterfeits reached $467 billion (about 630 trillion won), with online marketplaces at the center of its distribution.

So why don’t platforms stop it? They do run safeguards, but there are structural limits to how much they can block in advance. This post looks at those limits and uses data to show why brands increasingly need to act as well.

How serious is the counterfeit problem?

According to the OECD’s “Mapping Global Trade in Fakes 2025,” published in May 2025, global trade in counterfeits is worth $467 billion, about 2.3% of total global trade. Notably, 65% of seizures involved small parcels and mail, showing that small, dispersed shipments through online marketplaces are a major distribution route.

In Korea, the picture is even closer to home. According to enforcement results released by the Korea Customs Service in May 2026, IP infringement seizures in 2025 totaled 278.9 billion won, a 64% jump from 170.5 billion won the year before. The Ministry of Intellectual Property seized about 143,000 counterfeit items in 2025 (worth 432.6 billion won at genuine retail prices) and criminally charged 388 people, a 32-fold increase year over year by genuine retail value.

And it’s spreading beyond luxury and fashion. In 2025, about 56,000 counterfeits of K-beauty brands such as Beauty of Joseon and SKIN1004 were seized at once in Guangdong, China, and blocked K-beauty counterfeits more than doubled from 16,000 in 2023 to 36,000 in 2025. Of the K-brand counterfeits caught in customs enforcement, 97.7% were made in China.

The structural reality of Korean open marketplaces

Most Korean open marketplaces operate as mail-order brokers: the platform doesn’t sell products itself, it only connects sellers and consumers. Under Korea’s e-commerce law, mail-order brokers aren’t legally liable for what sellers on their platforms do. Even when counterfeits cause harm, the “we only brokered the sale” exemption applies.

According to the Korea Intellectual Property Protection Agency, 1,083,472 counterfeit listings were found on Korean and overseas open marketplaces over the past five years. Counterfeits circulate widely, whatever the platform’s size. And while in April 2026 the Korea Fair Trade Commission ordered seven major open marketplaces, including Coupang and Naver, to correct 11 unfair liability-exemption terms, any duty to actively block counterfeits remains a legal blind spot.

Three structural reasons platforms can’t stop counterfeits

1. Current law and operations lean toward after-the-fact response, not pre-screening

Korean open marketplaces are generally classified as mail-order brokers: intermediaries between sellers and consumers rather than direct parties to the sale. Their legal obligation to verify every listed product in advance is limited, so in practice most work on notice-and-takedown rather than screening everything. Review and removal happen after a brand or consumer reports.

2. Verifying sellers and verifying supply chains are different problems

Seller onboarding on Korean open marketplaces mostly checks business information and basic documents. Platforms can only go so far in verifying, in advance, where the products actually come from or whether they’re officially distributed. And because almost anyone can start selling on an open marketplace, counterfeit sellers can get in through much the same process as everyone else.

3. The sheer volume of transactions makes human review difficult

Large platforms handle millions of transactions and a huge volume of new listings every day. Having people pre-screen all of it isn’t realistic. Platforms do run AI detection, monitoring and reporting systems, but in practice much of the work still happens after a brand or consumer reports. The model is closer to “fast detection and response” than “block everything in advance.”

How counterfeit sellers are evolving: AI and mixed inventory

Counterfeit sellers have already adapted to report-driven enforcement. The main tactics today:

Altered keywords: They evade search filters by altering brand names with typos, initials or similar-sounding words, such as “Nikl” or “N1ke” instead of “Nike.”

Mixed inventory: They mix genuine products and counterfeits under the same ASIN (product ID) or seller account, borrowing credibility from established accounts with reviews and ratings built on genuine sales.

AI-generated product images and descriptions: They use generative AI to mass-produce images and product pages similar to the real brand’s. Counterfeits of Beauty of Joseon have become so sophisticated that they’re hard to tell apart even in side-by-side comparison photos. Eyeballing listings and simple keyword filters won’t catch them.

Indirect export routes: To evade enforcement, shipments from China routed into Korea via the US have also been detected, with about 130,000 items worth 18 billion won seized on this route alone.

Fast account switching: When a report gets an account deleted, they open a new seller account right away and relist the same products. Some switch company names or sell under someone else’s name.

The real harm to brands: it starts at search, not at checkout

If you count counterfeit harm only as lost sales, you’re seeing half the picture. The harm starts long before a consumer decides to buy, at the search stage.

Collapsing price benchmarks: When counterfeits show up at 10–30% of the genuine price, consumers start treating that as the reference price, and the genuine price starts to look unreasonable.

Less visibility for official channels: Algorithms rank listings based on clicks and sales. When cheap counterfeits get lots of clicks, the brand’s official store gets pushed down.

AI search pollution, a new kind of harm: One data point stands out. According to BrightEdge research, ChatGPT cites marketplace and retailer pages 36% of the time when consumers search for products. Google AI Overviews also appear in 14% of shopping-related searches, a 5.6-fold jump in just four months. When consumers look up products with AI, marketplace seller pages become the source of the answers. Counterfeit seller pages included.

Damaged trust and after-sales disputes: Consumers who bought counterfeits thinking they were genuine blame the brand for the quality. Negative social media reviews and customer service complaints follow, and AI cites those reviews in turn. A vicious cycle.

Regulatory change, and its limits

The regulatory environment is changing, though. In April 2026, the Korea Fair Trade Commission ordered seven open marketplaces, including Coupang, Naver and 11st, to correct 11 unfair terms. The core aim is to limit platforms’ practice of unilaterally setting liability exemptions in their own favor.

In Europe, the EU Digital Services Act (DSA) has entered active enforcement. In July 2025, the European Commission issued a preliminary finding that Temu had breached its obligation (DSA Article 23) to assess the risks of illegal and unsafe products. In February of the same year, it also requested internal documents on illegal products from Shein. Violations can bring fines of up to 6% of global revenue.

But regulation has structural limits. The law mostly requires “prompt response to reported cases,” not “proactive detection and blocking.” No report, no regulation. Brands still have to find and report counterfeits first.

Why brands need to act themselves in the age of AI search

The way consumers search for products is changing. Google AI Overviews appear in 14% of shopping-related searches, a 5.6-fold jump in just four months. According to BrightEdge research, ChatGPT cites marketplace and retailer pages 36% of the time when consumers search for products. AI is moving deep into the consumer’s path to purchase.

Counterfeits tie directly into this shift. If brands don’t clean up marketplaces, AI cites counterfeit seller pages, those answers reach consumers, and consumers buy counterfeits. Managing marketplace channels is no longer just a sales channel question. It’s about managing how trustworthy your brand looks in search.

Platforms won’t wait for you. Between a report and a removal, counterfeits get cited in AI search, clicked and bought. Without always-on monitoring, brands can’t break the cycle.

MarqVision’s strategy for managing brand channels

MarqVision helps brands monitor online marketplaces continuously and detect and report counterfeits automatically.

Using an LLM agent trained on the brand’s product information, platform policies and IP infringement patterns, MarqVision identifies counterfeits by analyzing image similarity, price outliers and seller behavior together, not by simple keyword matching. Altered keywords and mixed inventory are covered too.

Detected counterfeits flow through an automated pipeline (detection, analysis, automatic reporting and enforcement, then results analysis and insights) all the way to platform reports. For brands, what matters most here is response speed. Counterfeits need to come down before AI search cites them and before consumers click. MarqVision builds that speed into always-on detection, not one-off reports.

Request a free demo now and see your brand’s channel status in the data.

FAQ: why marketplaces don’t stop counterfeits

Q1. Why don’t counterfeit reports to marketplaces work?
On most platforms, it takes days from receiving a report through review to removal. Meanwhile, counterfeits keep selling, and even after removal, sellers immediately return with new accounts. One-off reports remove the problem for a while but don’t solve it. Without continuous monitoring and repeat reporting, brands always lose the war of attrition.

Q2. Is AI search (Gemini, ChatGPT and others) related to counterfeits too?
Directly. AI search models cite marketplace pages as major sources when generating answers. According to BrightEdge research, ChatGPT cites marketplace and retailer pages 36% of the time in shopping-related searches. Counterfeit seller pages left up on marketplaces can become the basis for AI answers, and that directly shapes what consumers buy.

Q3. Do small brands face online counterfeit problems too?
Size doesn’t matter. In fact, small brands without dedicated IP enforcement staff are more vulnerable. As with K-beauty brands such as Beauty of Joseon and SKIN1004, the moment global awareness rises, a brand becomes a counterfeit target. Harm is surging in non-luxury categories too, such as beauty, health supplements and outdoor gear.

Q4. What’s the first step a brand can take on its own?
Start by searching major open marketplaces yourself for your brand name and main product names. Check whether unauthorized sellers besides your official store sell the same or similar products. Report any suspicious sellers right away through the platform’s reporting channel, and if the same sellers keep coming back, consider a specialized solution such as MarqVision.