EU Commission Penalises Temu €200m for Illegal Product Sales
The European Commission has levied a €200m penalty against the Chinese-owned online retailer Temu. The fine follows an investigation that identified the sale of illegal products, such as unsafe baby toys and substandard electrical chargers, through its platform.
Regulatory Non-Compliance and Safety Breaches
According to the Commission, Temu "failed to diligently identify, analyse and assess the systemic risks" associated with these products, thereby neglecting the potential harm to consumers. The investigation, initiated in October 2024, scrutinised Temu's adherence to its obligations as a designated Very Large Online Platform under EU law.
An independent 'mystery shopping' exercise revealed a high failure rate for chargers purchased via Temu in basic electrical safety tests. Furthermore, a substantial number of baby toys were found to contain chemicals exceeding legal limits or featured small, detachable components posing suffocation hazards.
Temu has disputed the Commission's decision, characterising the fine as disproportionate, and is evaluating its options. A spokesperson for the company stated that while it respects the necessity of clear regulations, the decision pertains to 2024 and does not accurately reflect the current state of its operational systems.
Beyond the financial penalty, Temu is mandated to submit an action plan by 28 August, outlining its strategy to rectify these systemic failures. The Commission will then assess the company's compliance within a two-month period. This marks only the second fine issued under the EU's Digital Services Act for content-related issues, following a €120m penalty imposed on X (formerly Twitter) last December.
