(TDB) - Pinduoduo, the Chinese tech start-up that raised more than US$1.6 billion in an IPO last week, has quickly become the subject of investigation by China’s state market regulator, following various media reports alleging that the company’s e-commerce platform is awash with counterfeit and copycat products from electronic shavers to imported wines including lookalike Penfolds and Château Lafite Rothschild.

The State Administration for Market Regulation (SAMR) has called for the Shanghai Municipal Administration of Industry and Commerce and other relevant market regulators to investigate the company’s sale of counterfeit and lookalike products, Hong Kong’s SCMP has reported.

The quick response from the regulator comes at a time when China is looking to pass its first e-commerce law, which would hold online retailers accountable for the sale of fake goods on their platform. Currently only merchants caught selling fake goods are solely responsible.

Founded in 2015, Pinduoduo utilises a model that relies heavily on social media, and has quickly become China’s third biggest e-commerce service provider behind Alibaba and JD.com.

Last week, the company raised US$1.6 billion in an initial public offering (IPO) in the US, but the platform, mostly popular in China’s lower-tier cities and known for its massive discounts, has been accused by different companies of selling counterfeit goods.