EU Launches Investigation into Temu Over Illegal Product Sales
The European Commission has initiated formal proceedings against the online retailer Temu, citing alleged violations of the Digital Services Act (DSA). This action follows an investigation by both the European Commission and Ireland’s Coimisiún na Meán into Temu’s operations, particularly focusing on the sale of illegal products and the potentially addictive design of its service. The proceedings aim to ensure compliance with EU laws designed to maintain a safe and fair market environment for all participants.
Central to the investigation is the effectiveness of Temu’s systems in preventing the sale of illegal products within the EU. Authorities are particularly concerned about the platform’s ability to manage the reappearance of rogue traders previously known for selling non-compliant goods. Additionally, the investigation will scrutinize Temu’s mechanisms for preventing illegal goods from re-entering the market, which is a critical aspect of the platform’s compliance with the DSA.
Another significant area of concern is the addictive nature of Temu’s platform design. The European Commission is examining game-like reward programs and other features that may pose risks to users’ physical and mental well-being. The investigation will also assess how Temu’s recommender systems influence user behavior and whether the platform complies with obligations to provide researchers access to publicly available data.
If the allegations are substantiated, Temu could face penalties, including fines of up to 6% of its global revenue. In the second quarter of this year, Temu’s parent company, PDD Holdings, reported revenues of €12.2 billion. The European Commission has emphasized that the duration of the investigation will depend on factors such as the complexity of the case and the level of cooperation from Temu. The proceedings underscore the EU’s commitment to enforcing digital laws and maintaining a level playing field.
Source: EU launches action against shopping website Temu over illegal products
