US: E-commerce firms need to do more about fake goods
DHS considers the issue a threat to national security because of the potential danger to public health from adulterated pharmaceuticals and cosmetics as well as the harm to the US economy
Updated 26 January 2020
AP
WASHINGTON: E-commerce has unleashed an increasing torrent of fake merchandise upon the world and private companies and the US government must do more to address the problem, White House administration officials said Friday as they released a plan aimed at cracking down on counterfeit goods.
An “action plan” released by the Department of Homeland Security says the government will apply increased scrutiny of e-commerce, including the third-party sellers who sell goods on the major online sites as well as shippers and operators of warehouses where merchandised is stored.
It also calls on e-commerce companies to strengthen protections for consumers, more thoroughly screen third-party sellers who use their sites and take other actions to reduce the spread of counterfeit products that has ballooned with growth of online sales in recent years.
“Some platforms have put in place certain measures to guard against counterfeits,” Chad Wolf, the acting secretary of DHS, said in releasing the plan, “but there efforts are oftentimes overwhelmed by the scale of the activity online.”
Fake merchandise, everything from bogus medicine to knockoff handbags, has always been around but has never been so universally available with the growth of e-commerce through sites such as Amazon, eBay and the Chinese giant Alibaba.
The international trade in counterfeit products rose 154 percent, from $200 billion in 2005 to $509 billion in 2016, according to the Organization for Economic Cooperation and Development. DHS said in the report that it made nearly 34,000 seizures of fake goods in 2018, a 10-fold increase from 2000.
To underscore their point, and the potential risk, they displayed a range of bogus goods, including a bike helmet, cigarettes, auto parts and tools and fake medications.
DHS considers the issue a threat to national security because of the potential danger to public health from adulterated pharmaceuticals and cosmetics as well as the harm to the US economy. Officials say the proceeds from counterfeit goods may also benefit global criminal networks.
FASTFACT
The Department of Homeland Security made nearly 34,000 seizures of fake goods in 2018, a 10-fold increase from 2000
“This is an absolute righteous threat that’s growing exponentially every single year,” said Mark Morgan, acting commissioner of Customs and Border Protection.
The plan was created in response to a presidential memo signed by President Donald Trump in April that called for the creation of a strategy to rein in what the administration called the “Wild West” of online counterfeit goods.
In addition to increased scrutiny of the industry and enforcement, the plan says authorities will seek to apply fines and penalties to a “broader range” of participants in the counterfeit networks and launch a consumer awareness campaign.
Release of the plan follows the recent signing of the Phase 1 trade agreement with China, in which the Chinese government agreed to combat patent theft and counterfeit products.
At the time, Alibaba said it would welcome the administration’s work to combat counterfeiting. The company said it has developed systems to protect intellectual property and has worked with brand name companies, law enforcement, consumers and trade associations to battle the problem.
E-commerce company eBay said: “We welcome and support this multi-stakeholder dialogue and look forward to continuing to work collaboratively with the administration, Congress, law enforcement and our industry partners to combat counterfeits and bad actors,” it said.
Saudi Arabia tops Middle East venture capital market with $1.7bn haul and record deal flow
Updated 17 sec ago
Nour El-Shaeri
RIYADH: Saudi Arabia led venture capital activity in the Middle East in 2025, pulling in $1.72 billion in funding — up 145 percent year on year — and recording 257 deals, a 45 percent increase, a new report showed.
According to MAGNiTT’s annual report on venture capital in emerging markets, the Kingdom ranked as the most active in the region by both funding and deal count, as Middle East fundraising climbed to $3.43 billion, up 89 percent from 2024, and total transactions reached a record 581 — a 13 percent annual increase.
MAGNiTT attributed the Middle East’s rebound to a return of late-stage liquidity and stronger investor sentiment, supported by “diplomatic ties, key events, and rising investor confidence.”
The report said the region also posted a record $1 billion in “mega deals,” alongside a narrowing funding gap with Southeast Asia, as the Middle East outpaced the sub-region in deal activity for the first time.
Speaking to Arab News about the investment market in 2025, Philip Bahoshy, CEO and founder of MAGNiTT, said shifting priorities shaped deployment decisions through the year.
“What stood out most was how investor behaviour adapted. Venture and broader private capital became more selective,” he said, adding that diligence moved “away from momentum towards fundamentals, scale, and clear paths to liquidity.”
He also said that “in a year shaped by global uncertainty, the GCC continued to establish itself as a long-term home for global venture and private capital investments.”
Bahoshy framed the 2025 venture cycle against a volatile macro backdrop, as markets “shifted rapidly” as geopolitics reshaped trade routes and oil prices, and public markets that had pushed to record highs facing sharper corrections linked to tariff shocks.
In that environment, he said, investors spent more time pressure-testing fundamentals and underwriting clear routes to liquidity, with capital allocation decisions increasingly shaped by resilience, policy direction, and the depth of local market infrastructure rather than momentum-driven narratives.
Beyond the Middle East-only cut, MAGNiTT said MENA venture capital funding totaled $3.8 billion across 688 deals in 2025, representing a 74 percent increase in funding and a 6 percent rise in deal flow.
Across EVMs overall, MAGNiTT reported a modest recovery in 2025 funding, with total capital rising 0.9 percent year on year to $9.63 billion, even as deal activity fell 12 percent to 1,521 — its lowest level in seven years. Total investors declined 15 percent to 1,564, and exits fell 12 percent to 91.
MAGNiTT attributed part of the 2025 EVM mix to a sharp decline in $100 million-plus “mega deals,” saying: “In 2025, MEGA deals across EVMs experienced their weakest performance since 2016,” and accounted for 24 percent of total capital raised, down from 39 percent in 2024.
Southeast Asia recorded a 29 percent year-on-year decline in funding to $4.08 billion alongside a 29 percent fall in deals to 446, while Africa posted a 28 percent increase in funding to $1.45 billion despite a 15 percent decline in deals to 298, the report showed.
Saudi and Gulf markets gain share
Within EVMs by deal count, Singapore remained the most active country with 274 agreements, despite a 20 percent year-on-year decline, while Saudi Arabia ranked second at 257 deals and the UAE recorded 231 deals, MAGNiTT reported.
The report framed the Gulf Cooperation Council region as “a durable destination for venture and private investment in 2025,” pointing to a shift in capital allocation toward markets perceived as more stable and better positioned for long-term deployment.
In dealmaking, the UAE remained among the most active Middle East markets with 231, up 1 percent year on year, while Saudi Arabia took the top position in 2025 deal activity within MENA for the first time, MAGNiTT said.
The report linked Saudi Arabia’s improved standing to stronger investment sentiment and government initiatives, including Vision 2030, while noting that international participation in regional rounds increased across growth and late-stage deals.
Fintech and late-stage deals dominate
Fintech remained the main driver of venture funding in the Middle East, attracting $1.04 billion — up 164 percent year on year — across 152 deals, a 48 percent increase, MAGNiTT reported.
It also pointed to breadth beyond financial services: e-commerce and retail drew $494 million, sports and fitness secured $309 million, telecoms and communications attracted $236 million, and enterprise software raised $184 million in 2025.
Fintech also led funding across Southeast Asia and Africa, supported by events such as Money20/20, the Arab Fintech Forum, and the Fintech Summit Singapore.
In Southeast Asia, fintech funding reached $1.81 billion, while enterprise software took $505 million and IT solutions raised $327 million; in Africa, fintech received $478 million, followed by energy at $252 million and e-commerce and retail at $115 million, MAGNiTT reported.
Late-stage rounds featured prominently in MENA’s 2025 performance. MAGNiTT said five mega rounds totaling $1.04 billion were completed by Ninja, HALA, Tabby, XPANCEO and Aialo, and that international investors joined regional cap tables alongside local backers.
The report listed Wellington Management, Atomico, and Atlea Partners, as well as Opportunity Ventures, CVC Capital Partners and Bluepool Capital, among global firms participating in regional venture rounds.
At a regional level, Ninja’s $254 million raise was identified as the largest Middle East deal by headquarters. It also said Opportunity Ventures had the highest estimated capital deployed in the Middle East at $250 million, while +VC was the most active investor by deal count with 40 transactions.
Exits improve, outlook cautious
In the Middle East, exits rose 19 percent year on year to 32, MAGNiTT reported, with the UAE recording 17 M&As, the highest number of exits by headquarters in the region.
At the same time, the report noted continued investor focus on realizations, writing: “The growth trajectory is clear, but where are the exits?”
M&A activity in MENA increased 41 percent year on year, with strategic buyers becoming more active and local acquirers accounting for 23 of 45 M&As. Across EVMs more broadly, however, M&A continued to slow for a third consecutive year, with 91 transactions recorded in 2025.
The report said the Middle East and Africa diverged from the wider trend, posting year-on-year increases in M&A activity, while Southeast Asia continued to decline to 24 M&As in 2025.
Artificial intelligence-related activity was another area of growth flagged in the report. AI-related company funding increased 204 percent year on year to $817 million in 2025, describing AI as moving from a future narrative to an active investment theme in the region. The report also pointed to broader tightening in investor selection as capital became more discriminating globally.
The executive summary also points to a widening set of international actors building on-the-ground exposure to the Gulf.
MAGNiTT said allocators from North America, Europe and Asia deepened their presence across private capital during the year, drawn by what the firm described as policy consistency, economic ambition and sustained investment in infrastructure.
As an illustration of the region’s rising prominence in global finance, the report notes that US President Donald Trump selected the GCC for his first international trip, while large financial institutions and asset managers — including Ray Dalio, Brevan Howard, KKR and Brookfield — expanded their local footprint.
US President Donald Trump and Saudi Crown Prince Mohammed Bin Salman in Riyadh. SPA
It also cites BlackRock’s decision to hold its board meeting in Abu Dhabi for the first time as another signal of how global capital is reassessing priorities.
MAGNiTT’s overview further highlights talent and corporate migration as a reinforcing factor for capital formation.
The report cites Bloomberg in saying 9,800 millionaires were set to relocate to Dubai in 2025, alongside a growing base of institutional investors and intermediaries.
It also notes that 600 multinational companies have regional headquarters in Saudi Arabia, and that Dubai passed a milestone of being home to more than 100 global hedge funds, according to Bloomberg.
Taken together, Bahoshy argues, these developments have supported a broader “feedback loop” in which stronger capital markets activity attracts additional investors, acquirers and founders, improving the conditions for repeat entrepreneurship and follow-on investment.
Looking ahead, the executive summary strikes a cautious tone on risks, pointing to persistent geopolitical uncertainty and continued pressure from global debt dynamics, even as it says the region’s foundations are stronger than at any previous point.
MAGNiTT’s outlook for 2026 emphasizes the importance of disciplined deployment and expects further integration of global investors into the ecosystem alongside deeper international fund formation, with private capital activity continuing to evolve beyond venture as the GCC’s role in the global investment landscape expands.
