L’Oreal has initiated legal action against Ebay, claiming is is not doing enough to stop the sale of counterfeit goods.

The cosmetics manufacturer says its action in France, Germany, Britain, Belgium and Spain is the result of an increasing volume of illicit trade in fake fragrances and cosmetic products on Ebay's auction sites.

L'Oreal, whose products are sold under brands such as Giorgio Armani, Ralph Lauren, Cacharel and Lancome, told Computeractive that it hoped the action would protect consumers and help to preserve the quality of its "selective luxury distribution network" as well as "defending the reputation of its trademarks."

It said this was currently not happening whilst Ebay continued to "feature luxury products for sale in significant quantities by unauthorised dealers, including products without outer packaging or leaflets containing health and safety information such as ingredients lists and precautionary warnings."

However, Ebay disagreed with L’Oreal’s stance, claiming that lawsuits against auction sites and market places were "not the solution to the counterfeit problem" and only fuelled the problem further.

It argued that the problem of counterfeiting was a widespread global issue that affected businesses online and offline. It said that it had been caught in the cross-fire between "L'Oreal and a small number of individuals who had allegedly infringed L'Oreal’s trademarks."

A representative for Ebay told Computeractive: "We are disappointed L'Oreal has filed a lawsuit against Ebay, given that we have been actively supporting their brand protection efforts.

"The only ones benefiting from litigation are counterfeiters, because valuable time and money is being spent in courtrooms rather than stopping counterfeiters from producing the goods."

It suggested that co-operation between rights owners such as L'Oreal, channels of distribution, industry associations and law enforcement would be a better way to stop counterfeiters.

L'Oreal joins other luxury goods companies such as Christian Dior and Louis Vuitton, who both filed similar lawsuits against Ebay last year.