Chinese online retail platform Temu has been fined €200 million ($232 million) by European Union regulators for failing to adequately prevent the sale of illegal products on its platform.
The penalty, announced by the European Commission on Thursday, follows the first phase of a broad investigation conducted under the EU’s Digital Services Act (DSA), which requires major online platforms to address illegal and harmful content more effectively.
The investigation began after complaints were filed by the pan-European consumer organisation BEUC and 17 of its national member groups. Regulators concluded that Temu failed to properly identify and assess the risks linked to illegal goods sold to consumers across the European Union.
The Commission also criticised the company for not fully evaluating how its recommendation algorithms and influencer-driven promotions may have increased the visibility and sale of illegal products.
In response, Temu said it supports the goals of the Digital Services Act but disagrees with the Commission’s ruling, describing the fine as excessive. The company argued that the decision was based on its initial DSA assessment in 2024 and does not represent improvements made to its systems since then.
Temu stated that it has worked cooperatively with EU regulators throughout the investigation and has strengthened its risk assessment processes, governance systems, and consumer protection measures. The company also noted that it is reviewing its legal options while continuing discussions with regulators.
The European Commission has given Temu until August 28 to submit an action plan outlining how it intends to comply with DSA requirements. Regulators are expected to decide within two months whether the company’s measures are sufficient.
EU technology chief Henna Virkkunen said the decision sends a strong message about the importance of managing risks under the Digital Services Act.
Regulators will also continue examining whether Temu’s platform design encourages addictive behaviour, as well as concerns surrounding illegal product sales and access to platform data for researchers.
Under the DSA, companies can face fines of up to 6% of their global annual revenue for violations. Temu’s penalty is the second major fine issued under the law, following a €120 million fine imposed on X last December.
Source: citinews
