The European Union has levied a substantial €200 million ($232 million; £173 million) fine on the Chinese-owned online retailer Temu. The European Commission announced the penalty, citing the platform's failure to prevent the sale of illegal products, including hazardous baby toys and faulty electrical chargers, to consumers.
Systemic Risk Failures Cited
The Commission stated that Temu had "failed to diligently identify, analyse and assess the systemic risks" associated with the products offered on its site and the potential harm they could inflict on shoppers. This action follows an investigation that commenced in October 2024, examining Temu's adherence to its obligations as a designated Very Large Online Platform under the EU's legal framework.
Temu has expressed its disagreement with the ruling, characterizing the fine as disproportionate and indicating that it is currently evaluating its available legal options. The company spokesperson stated that while Temu respects the need for clear regulations, the decision pertains to 2024 and does not accurately represent the current state of its operational systems. "We disagree with the European Commission's decision and consider the fine to be disproportionate," they said.
Investigation Findings and Future Actions
The investigation included a mystery shopping exercise conducted by an independent testing organization. This exercise revealed that a significant number of chargers purchased through Temu failed basic electrical safety tests. Furthermore, a high proportion of baby toys identified posed safety risks, containing chemicals in excess of legal limits or presenting suffocation hazards due to small detachable parts, as reported by Euronews.
In addition to paying the €200 million fine, Temu is mandated to submit an action plan by August 28 detailing how it will address these identified failures. The European Commission will then have two months to assess whether the company's proposed measures are sufficient for compliance.
EU tech commissioner Henna Virkkunen conveyed that the decision was intended to send a "very strong message" to Temu regarding its responsibilities. This fine marks only the second penalty imposed under the EU's Digital Services Act concerning content violations, with the first being a €120 million penalty against Elon Musk's X social media network in December.
