Auckland (Avneet Kaur) Chinese online shopping giant Temu has been fined €200 million (around US$232 million) by European Union regulators after authorities found the company failed to properly stop illegal products being sold through its platform.
The penalty marks one of the biggest enforcement actions so far under the European Union’s tough Digital Services Act (DSA), a law designed to force major online companies to better protect consumers and remove illegal or harmful content.
European regulators said their investigation found Temu did not do enough to identify and reduce risks linked to illegal products being sold to consumers across Europe.
Officials also criticised the company’s recommendation systems and influencer-based product promotions, saying they may have increased the spread and visibility of potentially illegal or unsafe products.
The investigation began after complaints were filed by European consumer rights organisations and multiple national consumer groups across the EU.
According to the European Commission, Temu failed to properly assess the risks its platform created for customers and did not adequately address possible consumer harm linked to products sold through the app.
The Commission said the case is mainly about how online platforms manage risk and protect users, warning that large tech and e-commerce companies are expected to take stronger responsibility under Europe’s new digital rules.
EU technology chief Henna Virkkunen said the decision sends a “strong message” to online platforms operating inside the European market.
However, Temu has pushed back against the decision, arguing the fine is excessive and saying the ruling relates to an earlier 2024 assessment rather than the company’s current systems.
In a statement, the company said it respects the goals of the Digital Services Act and has already taken additional steps to improve platform safety, governance and consumer protection measures.
Temu also confirmed it is considering its legal and regulatory options while continuing discussions with European authorities.
The European Commission has now given the company until August 28 to submit a formal action plan explaining how it plans to improve compliance with EU rules.
Regulators are expected to review that plan before deciding whether further penalties or enforcement action are necessary.
Importantly, the wider investigation into Temu is still ongoing.
EU authorities say they are continuing to examine whether parts of the platform are designed in an addictive way, whether illegal products are still being sold and whether researchers are being given proper access to platform data.
Under European digital laws, companies can face penalties worth up to 6 percent of their global annual turnover for serious breaches.
The Temu penalty is now the second major fine issued under the Digital Services Act after social media platform X, formerly Twitter, was fined last year.
