Temu Under EU Investigation for DSA Violations on Marketplace Safety
The European Commission has issued preliminary findings indicating that Temu, a major online marketplace, may have breached the Digital Services Act (DSA) by insufficiently assessing the risks associated with illegal products offered on its platform. Evidence from a mystery shopping exercise revealed a significant likelihood that EU consumers could encounter non-compliant items, such as baby toys and small electronics, while shopping on Temu. The Commission found that Temu’s October 2024 risk assessment relied on general industry data rather than marketplace-specific information, potentially resulting in inadequate mitigation against the distribution of illegal goods.
The investigation, launched on 31 October 2024, is part of a broader effort to address the surge in unsafe, counterfeit, or non-compliant products available online within the EU. The DSA obliges online marketplaces to implement effective mechanisms for identifying and mitigating illegal content and products, including robust trader traceability and transparent recommendation systems. The Commission’s ongoing inquiry also examines Temu’s use of potentially addictive design features, the transparency of its recommendation algorithms, and data access for researchers.
Temu now has the opportunity to exercise its rights of defense, including reviewing the Commission’s investigation file and responding in writing to the preliminary findings. The European Board for Digital Services will also be consulted as part of the process. Should the Commission’s preliminary views be confirmed, Temu could face a non-compliance decision, fines up to 6% of its total worldwide annual turnover, and be required to implement corrective measures. Enhanced supervision may also be imposed to ensure ongoing compliance.
The proceedings are being conducted in cooperation with national Digital Services Coordinators, customs and market surveillance authorities, and other stakeholders, ensuring a coordinated approach. This investigation aligns with parallel efforts by the Consumer Protection Cooperation (CPC) Network and the first product safety sweep, reinforcing the EU’s commitment to consumer protection, fair competition, and a safe digital single market.
