October 11, 2021 Mr. Daniel Lee Assistant U.S. Trade Representative for Innovation and Intellectual Property (Acting) Office of the United States Trade Representative 600 17th Street, NW Washington, DC 20508

Subject: 2021 Special 301 Out-of-Cycle Review of Notorious Markets Comments (Docket Number: USTR-2021-0013)

Dear Mr. Lee: Tokopedia appreciates the opportunity to provide comments requesting our exclusion in the 2021 Review of Notorious Markets for Counterfeiting and Piracy (“Notorious Markets List”) by the Office of the United States Trade Representative (“USTR”). This submission will provide an overview of Tokopedia’s ongoing and planned anti-counterfeiting initiatives as well as our engagement with various stakeholders to demonstrate our strong commitment to protecting IPR. We would like to reaffirm that Tokopedia is passionately committed to protecting intellectual property rights (IPR) as we strive to be a trustworthy and safe platform for our users. Tokopedia’s motto is to “Make it Happen, Make it Better,” and we are continuously improving our efforts in our journey to combat counterfeiting and piracy. In addition to implementing various initiatives and cooperating with Indonesian regulators, we have proactively initiated engagements with many new stakeholders this year. We have received positive feedback from various trade associations and brand owners that they are pleased to see improvements in our anti-counterfeiting program. As we continue to improve our efforts, we welcome suggestions and feedback from all stakeholders including trade associations, brand owners, and enforcement agencies. About Tokopedia Founded in 2009, Tokopedia is an Indonesian company with the mission of democratizing commerce in Indonesia through technology. Co-founders William Tanuwijaya and Leontinus Alpha Edison developed the platform to help connect 270 million people living across Indonesia’s 17,000 islands – Tokopedia now reaches 99% of districts in Indonesia. Tokopedia's marketplace has over 500 million products, 100 million active users, and 11 million sellers, 86.5% of which are first time small- and medium-sized entrepreneurs, many of whom are not yet aware of the dangers of selling counterfeit or pirated goods. We only operate in Indonesia and do not offer our services elsewhere. Tokopedia has four lines of businesses:

● Marketplace & Digital Goods: Tokopedia is a C2C platform that connects merchants and buyers. We also have an Official Store with over 100 verified global brands. This was created so our users have direct access to original goods, which can then lower their chance of purchasing counterfeits. Our anti-counterfeiting efforts are focused on infringing listings in our marketplace.

● Fintech & Payments: Our financial services include digital wallets, affordable investments, merchant loans, virtual credit cards, protection products, data-driven credit scoring for lending, and more.

● Logistics & Fulfillment: Through our integrated logistics and fulfillment system, customers can choose their preferred package arrival time.

● Mitra Tokopedia: This is an offline-to-online business created to advance our mission of democratizing commerce and enabling small mom-and-pop shops to sell digital goods online while keeping their offline store. Through our wholesale service, small merchants can also purchase products at a lower price.

Tokopedia’s Anti-Counterfeiting Efforts Tokopedia is strongly committed to combating counterfeiting and piracy and protecting intellectual property rights to ensure the safety of our entire ecosystem. In 2020, we assisted 2,574 brands, removed over 1.9 million IP infringing products, and suspended over 30,000 shops. In H1 2021, we expanded our efforts to assist over 5,000 brands and removed over 1 million infringing products. This year, Tokopedia has allocated a significant amount of time and resources to protect IPR and mitigate risks associated with counterfeit products. We have formalized an anti-counterfeiting team with members from the following divisions:

● 12 people from the Trust & Safety team under the Risk Management team ● 3 people from the Litigation team under the Legal team ● 4 people from the Service Recovery team under the Customer Excellence team ● 26 people from the Customer-First Squad team under the Customer Excellence Team

The anti-counterfeiting team is responsible for combating counterfeit goods based on reports from rights holders. They also continually work to improve the reporting system, filtering system, and penalty point system. To further assist our anti-counterfeiting team’s efforts, we partnered with an advisory firm based in Washington, DC that developed a compendium of best practices to combat counterfeiting and supported our engagements with key stakeholders in the US, Europe, and Asia. We would like to highlight that we launched our Intellectual Property Protection Platform this year: https://www.tokopedia.com/intellectual-property-protection. We launched the platform to demonstrate our commitment to fight counterfeiting and to be transparent in our policies and procedures. While Tokopedia’s materials had previously been only in Bahasa Indonesian because we only operate in Indonesia, we have worked hard to add materials in English as well to help global brands and international trade associations navigate our platform. We have engaged extensively with stakeholders this year to present the initial version of our Intellectual Property Protection Platform and receive feedback on pain points as we prepare to launch the second version of the platform. More details on our anti-counterfeiting program are provided below.

I. Our Anti-Counterfeiting Policy and Improvements

A. Intellectual Property Rights (IPR) Policy Tokopedia’s Terms and Conditions lists our prohibited products policy (https://www.tokopedia.com/terms#konten). Listing products that infringe on trademarks and copyrights and violate the Indonesian Food and Drugs Supervisory Agency Distribution Permit

are strictly prohibited. We also prohibit merchants from selling business licenses on the platform. We work closely with government officials, private institutions, and other strategic partners to ensure that our platform aligns with the applicable law in Indonesia. The Terms and Conditions also state that Tokopedia has the right to take down the products and/or suspend sellers that violate our policy. Tokopedia’s senior leadership is committed to protecting IPR and combatting counterfeiting. We believe that communicating the leadership’s commitment plays an important role in shaping the company’s vision and trajectory. As a result, we released a public statement this year from co-founder Leontinus Alpha Edison along with our IPR principles that can be found our Intellectual Property Protection Platform.

B. Seller Onboarding and Vetting

Tokopedia’s team understands that seller vetting is an important practice to deter bad actors and mitigate counterfeits on our platform. Currently, we have the following requirements for the three types of sellers on our platform:

● Official Stores are required to submit legal documentation including the Business Permit, Articles of Incorporation, etc. Once we verify that the store is an official brand or authorized distributor, the store is marked as an Official Store.

● Power Merchants are required to submit the original photo of their Indonesian identity card (KTP) and a self-portrait photograph. We use live face detection technology to ensure that the seller’s face matches the photo in the ID card. Sellers must also submit their phone number or email address. After users complete the verification process, they are required to register their bank account information to ensure that the name matches that on the bank account.

● Regular Merchants are required to submit their phone number or email address to open an account. After users complete the verification process, they are required to register their bank account information to ensure that the name matches that on the bank account.

Regular Merchants can become Power Merchants if they have 1) Opened a store for over 90 days with a minimum Performance Score of 60, which is calculated based on various factors including penalty points; or 2) If they have opened a store for less than 90 days and have at least one active product. Once qualified Regular Merchants complete the seller verification process, they can become a Power Merchant and enjoy benefits such as lower shipping costs, no credit card/debit card fees, comprehensive reports on the progress of the shop, and more. Sellers must maintain a Performance Score of at least 60 to be an active Power Merchant; Benefits will not be available if the score falls below 60. Since KYC procedures are uncommon in Indonesia, we have added these incentives to encourage sellers to complete the seller verification process. As a result of our efforts, in 2021, the vast majority of merchants with transactions in Tokopedia were KYC-ed as part of the seller vetting process. On our Seller Education page, we have uploaded detailed information in Bahasa Indonesian on how sellers can register as a Power Merchant. We also encourage sellers to complete the verification process and register as a Power Merchant since it will increase their trustworthiness, make their shop more attractive, and increase their income. Since many MSMEs are unfamiliar with procedures to verify their national ID online, we also provide detailed information on how merchants can complete the verification process with screenshots of each step. An example of this page is provided below as reference.

C. Takedown Procedures Our reporting procedure is based on industry standards and complies with Indonesian regulations. The reporting process is below:

● Rightsholders submit takedown requests with required documents through our online form available in both English and Bahasa Indonesian: https://www.tokopedia.com/help/ban-product.

● After the report has been successfully submitted, the reporter will receive an email confirmation. The report will then be reviewed by the legal team within 14 days after the report is received.

● If the report is approved, the reported products will be completely taken down. The reporter will receive an email notification that the report has been resolved. If the documents are deemed not valid, the reporter will receive an email notice with an explanation.

In 2020, Tokopedia received a total of 139,526 reports from rightsholders through our online form. After conducting due diligence of the supporting documents, we approved 124,318 reports (>89%) and removed 1,922,227 products. Most of the reported products were taken down within 12 hours with a median time of within 6 hours. Tokopedia noted that stakeholders stated in their submissions for the 2020 Notorious Markets List that we have an “unclear takedown process, and poor communication.” To add transparency and help rights holders in the US and elsewhere better navigate our takedown procedures, we added detailed reporting guidelines in our Intellectual Property Protection Platform this year in both English and Bahasa Indonesian. Examples are included below.

We value the safety of our customers and encourage them to report counterfeit products on our website. On each Product Page, there is a report button for customers. If customers use this reporting feature, our agents review the reports and remove products listed in the valid reports. An example of the reporting button is provided below as reference.

II. Our Proactive Measures

A. Seller Education Indonesia has 270 million people living across 17,000 islands. Our e-commerce platform aims to help MSMEs overcome physical barriers by connecting them to buyers across Indonesia. Tokopedia believes that seller education is crucial since many of our first-time entrepreneurs are unaware of the consequences of selling goods that violate IPR. Therefore, we have been developing various education material for sellers in their end-to-end journey. In the seller onboarding process, we are now directing sellers to our Intellectual Property Protection Platform that contains information regarding our IPR principles. We also uploaded various educational articles on our seller education page. An example is an article on our prohibited products policy: https://seller.tokopedia.com/edu/produk-yang-dilarang/. The article explicitly states that products violating IPR are prohibited and provides an example of a counterfeit listing for sellers that do not know the concept of IP infringement.

During the product upload process, we plan to direct sellers to the Intellectual Property Protection Platform and remind sellers that they should not upload listings that infringe on IPR. If a seller’s product is removed for infringing on IPR, the seller will receive a notification with an explanation and be directed to our Intellectual Property Protection Platform for further education.

B. Proactive Filtering Mechanism Tokopedia uses a filtering system to filter prohibited products, including those that infringe on IPR. We use keyword filters and image filters to detect prohibited products. In addition, we filter listings based on price and keywords to detect pirated products. Through this mechanism, products under a certain price threshold will be investigated for potential copyright infringement. This year, we have been using Optical Character Recognition (OCR) technology to extract characters and texts from product images to identify brands. We have been pairing this technology with our price filtering mechanism to detect cheap counterfeit products for takedowns. We have been implementing this pilot project for several categories beginning May 2021. As a result, we have removed >68,000 counterfeit listings. We plan to expand this project to other categories beginning Q4 2021. Certain stakeholders have noted that sellers on Tokopedia’s platform use descriptions such as “replica” or “copy.” We would like to note that if we receive takedown reports for products with “copy,” “replica,” “repro,” “grade x,” and “non-ori” in the description, the products will be taken down from our platform. In the past, Tokopedia used the keyword “replica” to detect counterfeit goods but due to the high number of false positives, we now use more detailed keyword combinations with the keyword “replica” to detect counterfeit goods, for example: keywords that are more localized such as “barang KW,” specific titles for media products, etc.

C. Penalty Point Mechanism Tokopedia implemented the penalty point mechanism in 2019 for repeat infringers that list counterfeit and pirated goods. In H2 2020, 24,108 shops were suspended due to IP infringements. With all the efforts in fighting IP infringements, we have seen a decrease in shop suspensions in H1 2021, where 14,394 shops were suspended due to IP infringements based on the penalty point system. One of the reasons causing the decrease in the number of shops is due to the inability of the bad sellers to re-open their shops (or open new shops) once terminated based on the stricter penalty point mechanism, and our continuous effort in providing education for sellers during the end-to-end seller journey to prevent repeat offenders. Tokopedia strengthened our penalty point system this year and the details are available on our Intellectual Property Protection Platform: https://www.tokopedia.com/intellectual-property-protection/consequence. Under the current penalty point system:

● The penalty points calculation is triggered based on the following scenarios: ○ Every report from users, brand owners, and government bodies results in 10

penalty points per shop; ○ Findings of infringing listings through Tokopedia’s internal sweeping results in 10

penalty points. ● Penalty points arising from the same Brand Owner / IP Rights Holder to the same shop

will result in a higher penalty point score (incremental by 10 points). For example: o If Brand A reports Shop X, on the 1st report 10 points will be added. o If Brand A reports the same Shop X, for the 2nd report 20 points will be added,

and so on, until the shop is suspended. ● Penalty points are cumulative and do not expire after a certain period. ● Once a seller receives a total of 140 penalty points, the account is suspended indefinitely.

The seller then receives a notification that counterfeit products are prohibited in our marketplace and is required to remove all infringing listings from the store. Once our Customer Service team verifies that all infringing listings have been removed, the seller can reopen the store.

● Three suspensions result in the permanent termination of the seller’s account. The seller will be blacklisted in our system and cannot reopen another account in our marketplace.

Illustration:

Time of report (for a specific Shop) Incremental Penalty Point

Accumulated Penalty Points

Reports from Brand A to Shop X (1st) 10 10

Reports from Brand A to Shop X (2nd) 20 30

Reports from Brand B to Shop X (1st) 10 40

Reports from Brand A to Shop X (3rd) 30 70

Reports from Brand A to Shop X (4th) 40 110

Proactive Sweeping from Tokopedia 10 120*

Reports from Brand B to Shop x (2nd) 20 140**

*at >= 120 points, the shop will receive a warning message via the email and notification center **at >= 140 points, the shop will be suspended The table above represents the addition of penalty points when the shop is reported by the same IP Holder. To ensure consistency in our procedures, we have provided training programs and a clear standard operating procedure (SOP) to the team that directly handles the penalty point system and account suspensions/terminations. Since Q2 2021, our anti-counterfeiting team has been working to improve our penalty point system: 1) We are in the process of lowering the threshold for account suspensions; 2) We are planning to provide higher penalty points to shops that receive repeated reports by brands and principals; and 3) We are developing the technology to prevent sellers from uploading similar infringing products upon account reactivation. In 2021, we have also been immediately terminating sellers that list counterfeit vitamins and medicine regardless of the penalty point system to ensure the safety of our buyers during the COVID-19 pandemic. In addition to account termination, we are also reporting those sellers to law enforcement so that they are prosecuted. III. Cooperation with Brands & Stakeholders Tokopedia has partnered with Microsoft to detect counterfeit software on our platform. We work closely with Microsoft since we lack the capacity and expertise to detect original and counterfeit software. We believe such collaborations with brands are valuable as they result in increased customer trust and safety. We also collaborate with national brands and organizations, such as our recent collaboration with IKAPI (Indonesian Publishers’ Association) to detect and clean the platform from pirated books, with high accuracy and considerations to legitimate booksellers.

A. Brand Alliance Program To improve our notice and takedown procedures and further our proactive monitoring efforts, we are in the process of developing our Brand Alliance Program which will be launched on our Intellectual Property Protection Platform (https://www.tokopedia.com/intellectual-property-protection/brand-alliance/join). We officially launched the pilot phase of the program in Q3 2021 with several brands from our Official Store. After receiving feedback from brands participating in the pilot phase, we will improve our program and expand the membership in Q4 2021. Brands that are interested in joining the program can reach us at ip.protection@tokopedia.com. We have already held discussions with global brands such as HP, Microsoft, and Xiaomi. In addition, we encourage Brands to open Official Stores and participate in our Authorized Seller Program as a way to help Indonesian buyers be more confident the products they are purchasing are genuine. The Brand Alliance program will have a seamless reporting and takedown procedure. Tokopedia is aware that certain stakeholders have noted that our submission requirements are “burdensome” as legal documents have to be submitted in each report. To address this issue, rights holders in the Brand Alliance program will only need to submit legal documents once. In addition, there will be a faster Service Level Agreement (SLA) time for takedowns. These features have received positive feedback from stakeholders – one association has noted that this aligns with the European Commission’s recommendation for platforms to implement a fast-track takedown procedure for “trusted flaggers” with expertise in identifying counterfeit goods.

The Brand Alliance program will also be informative. We are preparing detailed information on takedown procedures as well as the status of the takedown report. In addition, each rights holder will have a dedicated point of contact from Tokopedia. Members will also have the opportunity to engage in constructive dialogue and provide feedback on Tokopedia’s IP protection policies and join forces in proactive monitoring and takedowns. We are developing additional methods to further collaborate with brands through our Authorized Seller Program (ASP), which would connect the member brand with sellers that infringe on IPR to give them the opportunity to sell original goods.

B. Tokopedia’s Engagement with Stakeholders While Tokopedia had collaborated with a few global brands on our platform, we did not have any other relationships with key stakeholders, especially trade associations, outside of Indonesia. As bad actors deploy sophisticated methods to evade detection especially with the rise in online sales during the COVID-19 pandemic, we believed it was crucial to collaborate with and learn from stakeholders. With the support of an advisory firm based in Washington, DC, Tokopedia’s anti-counterfeiting team (including representatives from the risk management team, compliance team, and legal team) proactively reached out to various stakeholders since Q2 2021 to share updates on our anti-counterfeiting measures and seek feedback and suggestions. More details on our engagement are included below. Trade Associations and Brands

● International AntiCounterfeiting Coalition (IACC): After our initial outreach in May 2021, we held a meeting in July 2021 to share updates on our anti-counterfeiting efforts. We provided a point of contact for future communications and shared our efforts to provide regular updates on our anti-counterfeiting program going forward.

● American Apparel & Footwear Association (AAFA): After our initial outreach in May 2021, the Tokopedia team met with members of AAFA’s Brand Protection Council in August 2021 to share updates on our anti-counterfeiting efforts and receive feedback on our efforts. We provided a point of contact for future communications and agreed to have regular conversations going forward.

● Union des Fabricants (UNIFAB): After our initial outreach in May 2021, the Tokopedia team met with UNIFAB in September 2021 to share updates on our anti-counterfeiting initiatives. We received positive feedback that our outreach demonstrated our willingness to collaborate with stakeholders. We met with UNIFAB members in October 2021 and had a very productive discussion. We will maintain communication and provide regular updates on our anti-counterfeiting program going forward.

● Association of American Publishers (AAP): After our initial outreach in May 2021,

we met with AAP member brands in August 2021 to learn about their priorities and to share updates on our anti-counterfeiting efforts. We provided a point of contact for future communications and shared our commitment to provide regular updates on our anti-counterfeiting program going forward.

● Anti-Counterfeiting Group (ACG): After our initial outreach in May 2021, we held a

meeting in July 2021 to share updates on our anti-counterfeiting initiatives and receive feedback on our program. To continue our collaboration, we participated in the Protecting Brands Online Roundtable hosted by ACG in September 2021. ACG published a summary of the meeting, stating that our team “open[ed] up to members about what [we] are currently doing to protect brand owners and their IP rights” and provided “a comprehensive and thorough response to members questions.”

● REACT: After our initial outreach in May 2021, we met with REACT in July 2021 to

share updates on our anti-counterfeiting initiatives and discuss areas for cooperation. We are in the process of finalizing a Memorandum of Understanding (MOU) with REACT that will be signed in Q4 2021 to formalize our collaboration on counterfeiting issues.

● Incopro: After our initial outreach in May 2021, we met with Incopro in July 2021 to

learn about best practices and to share updates on our anti-counterfeiting initiatives. We provided a point of contact for future communications and shared our willingness to provide regular updates on our anti-counterfeiting program going forward.

● Elipe: Elipe reached out to Tokopedia in July 2021 seeking updates on our anti-counterfeiting program. We held a meeting with their member brands in August 2021 and another follow-up meeting in September 2021 to update them on our initiatives. We plan to maintain communication, provide regular updates on our anti-counterfeiting program, and find areas for joint collaboration going forward.

● German Anti-Counterfeiting Association (APM): We met with APM in September

2021 to share information on how to report IP infringements on our platform. We also shared our efforts to protect IPR and provided information on our Brand Alliance Program.

● Indonesian Publishers Association (IKAPI): We signed a Memorandum of

Understanding (MOU) with IKAPI in late September 2021 and it was followed by a meeting with IKAPI in October 2021 to discuss how they can collaborate with Tokopedia to combat piracy and IP infringements. We also provided information on how their members can join our Brand Alliance Program.

In addition, we also conducted outreach to the following stakeholders to provide updates on our anti-counterfeiting initiatives: American Chamber of Commerce to the European Union, Chanel, Corsearch, OpSec Security, and the Global Brand Owner and Consumer Protection Coalition. Tokopedia is sincerely committed to working with stakeholders to combat counterfeiting and piracy on our platforms. Through our proactive outreach, we have successfully engaged with many new stakeholders to learn about global best practices for e-commerce platforms, share updates on our anti-counterfeiting initiatives, and understand stakeholders’ priorities and concerns. We are working hard to build trusted relationships and collaborate with stakeholders as we improve our anti-counterfeiting program.

C. Indonesian Government Agencies Tokopedia works closely with Indonesia’s BPOM (National Agency of Drug and Food Control). We signed a partnership agreement with BPOM in 2019 on the ‘Supervision of Drugs and Foods in E-Commerce Space.’ Through this agreement, BPOM conducts regulatory oversight of activities on our platform and Tokopedia takes necessary actions. Whenever BPOM makes formal requests regarding product links that violate regulations, we take down the listings immediately. We also share data with the Indonesian police upon request. During the COVID-19 pandemic, we have also been working closely with the local police and government officials to combat the rise in counterfeit medicine, vitamins, and supplements to ensure the safety of our users. In addition to closing the shops that are selling illegal and counterfeit health products, we have been providing their data to the police for prosecution. Our proactive efforts in addressing the issue of fake vitamins were covered by major Indonesian media outlets. We are also cooperating with regulators and brands to filter listings of COVID-19 testing kits, vaccines, and drugs based on price and keyword indicators to ensure the safety of our users. In July 2021, we participated in a session with @America, affiliated with the US Embassy in Jakarta, to present these IP protection efforts amid the global pandemic. This event was also attended by representatives from the Indonesian Government and the US Patent and Trademark Office. In addition, Tokopedia was among the five e-commerce platforms in Indonesia that participated in an event which included participants from the US Government, Indonesia’s Ministry of Law and Human Rights, and the Indonesian E-Commerce Association (idEA) to discuss the Indonesian government’s efforts to protect IPR. We further demonstrated our serious commitment as a responsible stakeholder to protect IPR and combat counterfeiting by supporting the idEA’s public declaration to support IPR policies as well as law enforcement. Conclusion Tokopedia is strongly committed to combating counterfeiting and piracy on the platform. As demonstrated above, we have devoted significant resources in our anti-counterfeiting program to launch the Intellectual Property Protection Platform, develop the Brand Alliance Program, and engage with more stakeholders. Our anti-counterfeiting team composed of members from the Risk Management team, Legal team, and Compliance team are also working hard to improve our penalty point system, develop education material, and improve our proactive filtering mechanisms. Our goal is to be a trustworthy platform, and we will continue to cooperate with stakeholders including trade associations, brand owners, and Indonesian law enforcement.

We respectfully ask USTR to take our proactive efforts into serious consideration and not include Tokopedia in the 2021 Notorious Markets List. We would be happy to answer any questions or provide additional information if needed. Sincerely, Tokopedia Team

Tok op ed iaIn t el lect ual Prop er t y (IP) Prot ect ion Rep or t H1 2021

ConfidentialAnnex: Tokopedia’s IP Protection Report for H1 2021

Overv iewAs a business based on of reputation and trust, Tokopedia is committed to protecting Intellectual Property (IP) and ensuring the safety and comfort of our entire ecosystem.

In line w ith our commitment, in the first half (H1) of 2021, we have made several efforts to combat counterfeiting and piracy such as:

● Creating an IP Protection Microsite as the info and reporting center.● Enforcing proactive monitoring. ● Improving our penalty policy.● Raising IP rights awareness to merchants. ● Collaborating w ith IP holders through our Brand Alliance Program.● Creating a more seamless reporting channel.

These efforts have resulted in the reduction of suspended shops from Tokopedia and reduced counterfeit and pirated goods from our site. W ith these efforts and a ‘growth mindset’ to continuously improve, we believe that Tokopedia can continue to create a safer ecosystem for our buyers, sellers, and stakeholders.

Confidential

Con t en t sConfidential

1

2

4

Tokopedia IP Protection H1 2021 - Impact

Technology - Based Initiativesa. IP Protection Micrositeb. Penalty Policy Improvementc. Proactive Monitoring Measures

Seller Education and Awareness Program

3 Brand Alliance Program

5 Conclusion

a. Overview of Seller Education Initiativesb. Examples

Confidential

In H1 2021, based on Tokopedia’s efforts to proactively identify and remove suspected IP infringing listings, driven by technology and supported by reports from IP holders and users, we have seen better results compared to H2 2020. In addition, there was a decrease in shop suspensions in the same period due to the decline in repeat offenders, reflecting the success of our seller education and awareness programs.

Tok oped ia IP Prot ect ion H1 2021Im pact - Reducing Repeat Offenders & Health ier Merchant Base

# of Shops we have suspended

In this period, there was a 40.3% decrease in shops suspensions (even with stricter penalty points) due to a decrease of repeat offenders because of our effort in educating sellers and expanding our IP microsite

40.3%

>1 MillionCounterfeit and IP in fring ing p roducts rem oved

In H1 2021:>5000Brands / Principals assisted

Tech n olog y-Based In it iat ivesIP Protect ion Microsite

Confidential

Our IP Protection Microsite is an information and education center, designed with a user-friendly interface for the sellers and IP holders/brand owners. The Microsite was first launched in April 2021 with several entry points on Tokopedia platforms. We arecontinuously updating the content of the Microsite with new information and adding new initiatives.

HomeOverview of our principles and commitment to protecting Intellectual Property (IP).

How to preventEducational information of IP infringements and how to prevent violating IP rights.

How to reportThis page is addressed to the IP holders, containing information on how to report in our reporting channel.

ConsequenceOverview of the consequences will be faced by sellers when violating IP.

Brand Alliance ProgramThis page is addressed to the IP holders, containing information about the Brand Alliance Program. It also includes information on the Authorized Seller Program.

LINK: Go to Tokopedia IP Protection Microsite.

IP Microsite initial launch (April 2021) Initial Improvements (Sept - Oct 2021) IP Microsite v.2

Seamless Reporting PortalProvides a more efficient and transparent reporting portal and mechanism for brands and key stakeholders

Tech n olog y-Based In it iat ivesProact ive Mon itoring Measures

Confidential

We have increased technology-driven and human resource-based proactive steps to monitor and sweep the counterfeit products our our platform. By implementing these steps, we have prevented about 68,000 counterfeit products from being sold or uploaded in H1 2021.

Keyw ord-based and Pricing Block Capabilit ies1

Proactive sw eeping by dedicated team2

With this system, we have proactively blocked certain counterfeit keywords (e.g., non ori) that might be located in the product’s name and description and/or certain product’s keywords combined with a very low price (e.g., software A that is priced lower than Rp 50,000 while the normal price is around Rp 700,000). Through this initiative, we have prevented about 68,000 counterfeited products from being sold and uploaded on Tokopedia in H1 2021.

We have a dedicated team that is responsible for sweeping the platform daily to identify suspected counterfeit products in Tokopedia. The sweeping is based on the combination of keywords and abnormal prices. Through this initiative, we have taken down hundreds of thousands of products in H1 2021.

Confidential

We have improved and created new initiatives to our penalty policy to give harsher sanctions on sellers to prevent them from repeatedly selling counterfeit or pirated goods, any other Intellectual Property infringements.

Higher penalty points to sellers for every report by sam e brand1

Preventing sellers from re-selling sim ilar products previously reported2

To be fair with IP holders/brand owners who repeatedly report and the shops who repeatedly violate, we increased our penalty points on repeat infringers so they can be suspended immediately. Based on this initiative, the data shows a 25.09% increase in shop suspensions in 1 month after the deployment of this new regulation.

Create strict shop term ination rule3

This is a new initiative that is currently in progress. When a violated product is reported by the IP holder and taken down by Tokopedia, the shop will not be able to sell or upload similar products to the previously reported ones to prevent them from repeatedly selling counterfeit products automatically.

In order to ensure a strict penalty for repeated infringers, we have adjusted our policy by decreasing their chance of requesting to re-open their shop after suspension. We determine the shop’s chances based on their badge—the lower their badge, the lower the chances.

Tech n olog y-Based In it iat ivesPenalt y Policy Im provem ent

Confidential

We created the Brand Alliance Program to allow Tokopedia and IP holders to continue the conversation and deepen our cooperation to effectively combat counterfeiting on the platform. The sophisticated feature that we offer through this program is a dedicated reporting portal & dashboard. In the pilot phase, we are only engaging with invited brands.

If you are interested in joining, please email us at ip.protection@tokopedia.com. Approved brands will have access to a dedicated dashboard registration link. To learn more about the Brand Alliance Program dashboard usage, please visit the Tokopedia IP Protection Microsite.

Key Programs

Online IP Protection Collaboration

Members are able to address IP Infringement reports efficiently and effectively through the new Tokopedia IP Protection reporting portal/ dashboard. Members are also able to monitor their reports in real-time.

Tokopedia also provides a direct communication channel between members and Tokopedia’s Anti-Counterfeit Team for any related issues.

Proactive Monitoring Collaboration

Members may provide Tokopedia with criteria for identifying counterfeit products.

Tokopedia will conduct a query and provide members with a list of potential counterfeit products that members can report on independently.

Bran d A l l ian ce Prog ram Key Program s

Seller Ed ucat ion an d Aw aren ess Prog ramOverview of Educat ion In it iat ives

Confidential

To maintain our Intellectual Property (IP) policy, we are committed to increasing our sellers’ awareness and knowledge about IP.In 2021, we have added several educational initiatives in all of our seller’s journeys. We have also centralized all information about IP on our Tokopedia IP Protection Microsite.

Seller creates shop

Seller does activities in Seller

Home

Seller uploads & sells product

Seller violates IP policy

All education material will be linked to the Tokopedia IP

Protection Microsite

E.g: From Q4 2021, new sellers will receive a welcome message that contains an educational video.

E.g: New sellers will be shown with an education quest. During the first 30 days, sellers will also be able to see the banner in the Seller Home page.

E.g: Sellers will see a warning not to sell counterfeit products in their product upload page.

E.g: Violated sellers will receive a ban/suspension message if they violate our policy

Confidential

We have put a 'user quest' on the seller homepage for new sellers, which will last for 30 days after the seller creates a shop. The key message contains an encouragement to learn about IP rights, what they are, and how to sell in Tokopedia while without violating IP rights. This will also be an entry point to our IP Protection Microsite.

Sel ler Ed ucat ion an d Aw aren ess Prog ramExam ple - Quest in Seller Hom e

Confidential

Act ion s Ag ain st Prod uct In f r in g em en t sDuring Covid-19, we have been working to reduce the unreasonable pricing of medicines and fake vitamins on our platform that have been rapidly increasing since July 2021. We also collaborate with law enforcement in combating and taking legal action against sellers who sell fake vitamins.

1) Proactive Sw eeping activit ies on fake vitam ins

*In addition to shop suspension, we also blacklisted the users’ device and bank account

Suspended and Terminated Shops

Products Removed*

365 shops > 3000Products

2) Police Report

Our stance to strictly protect our consumers by informing and reporting the perpetrator to the police, has been recognized and published in more than 90 national news outlets.

We collaborated with the Legal team to report several sellers who sell fake vitamins to the National Police

Con clusionConfidential

As a business of reputation and trust, Tokopedia is committed to protecting Intellectual Property (IP) and ensuring the safety and comfort of our entire ecosystem. We believe that the support of stakeholders is crucial in maintaining our commitment to combating counterfeiting/IP infringement. Therefore, in the first half of 2021, we have taken several enforcement actions in the form of several new technology-driven initiatives and stakeholder collaboration, which have been proven to be successful.

In line with Tokopedia's DNA and motto to “Make it Happen, Make it Better”, we are committed to continuously improve our program and creating new initiatives to make it better. We plan to expand our Brand Alliance Program by providing this to all brands interested in joining this program, optimize our reporting channel, increase the seller's education material, improve our proactive monitoring measures, and create more collaborative initiatives with stakeholders.

We are always open to any feedback and constructive dialogue to further improve our IP Protection efforts and initiatives.

Sincerely Yours,Tokopedia IP Protection Team Contact: ip.protection@tokopedia.com

Th an k y ou !

Confidential