The European Commission has found a "high risk" that consumers in the EU will encounter illegal products when shopping on Chinese e-commerce platform Temu. The warning comes as part of an investigation under the bloc's new Digital Services Act, which could result in hefty fines for the company.
Officials said Temu is failing to properly assess the risks of dangerous or illegal products being sold on its platform. A mystery shopping exercise conducted by the commission revealed consumers were very likely to find non-compliant products, including unsafe baby toys and small electronics.
Commission challenges risk assessment
The European Commission criticised a risk assessment carried out by Temu's parent company PDD Holdings in October 2024 as "inaccurate". Officials said the assessment relied on "general industry information rather than on specific details about its own marketplace".
Under the Digital Services Act, online platforms must evaluate how likely consumers are to encounter dangerous or illegal products and take steps to reduce these risks. The legislation represents the EU's attempt to better regulate online content and protect consumers.
Potential fines loom large
Henna Virkkunen, executive vice-president for tech sovereignty, security and democracy, said consumers trust that products sold in the EU's single market are safe and comply with regulations. She emphasised that "consumers' safety online is not negotiable in the EU".
Temu could face fines of up to six per cent of its annual worldwide turnover if the commission ultimately decides the company's risk assessment fails to meet legal obligations. The investigation also covers other suspected breaches including addictive design features and lack of transparency around algorithms.
Broader crackdown on Chinese platforms
The EU is attempting to counter what it sees as a flood of cheap and potentially unsafe products from China entering the single market. This forms part of a wider regulatory push against Chinese e-commerce giants operating in Europe.
Officials also sent a formal warning to fashion retailer Shein in May, saying the company's sales tactics violated EU consumer protection law. The crackdown reflects growing concerns about the safety and compliance of products sold through Chinese-owned platforms.
(PA/London) Note: This article has been edited with the help of Artificial Intelligence.
