Chinese e-commerce giant Temu is under investigation by the European Union for allegedly failing to prevent the sale of illegal products on its platform. The European Commission announced the probe five months after designating Temu as a “very large online platform” under the Digital Services Act (DSA), which imposes strict obligations on tech platforms to ensure user safety and transparency.
Temu, owned by China’s Pinduoduo Inc., has rapidly gained traction in Western markets by offering low-cost goods directly shipped from Chinese sellers. It boasts 92 million EU users but now faces scrutiny for allegedly allowing “rogue traders” to sell non-compliant goods that could reappear after suspension.
Margrethe Vestager, the European Commission’s Executive Vice-President, emphasized the need for Temu to uphold EU safety standards and ensure fair competition. “EU enforcement guarantees a level playing field and safeguards consumers,” she stated.
The investigation will also examine Temu’s compliance with the DSA’s transparency requirements, including whether its recommender systems provide non-personalized options for users. Regulators are probing the platform’s “game-like” reward programs for potentially promoting addictive behavior.
Temu pledged cooperation, stating, “We take our obligations under the DSA seriously and continue to invest in compliance to protect consumers.”
The investigation could lead to significant fines if Temu fails to address the concerns or meet EU standards. The company is also under scrutiny in the U.S. for allegedly allowing goods produced with forced labor to be sold on its platform.
This move reflects the EU’s broader crackdown on major tech platforms, including AliExpress and social media giants like TikTok and X, as part of its mission to ensure safer and more transparent digital marketplaces.
