Potential EU Penalties Loom Over Temu Due to Alleged Breaches of Digital Service Regulations
In a significant development, the European Commission has formally accused Chinese-owned online shopping app Temu of selling illegal products within the EU and violating the Digital Services Act (DSA). The preliminary findings suggest that Temu has fallen short in adequately assessing and mitigating risks related to the distribution of non-compliant products, such as baby toys and small electronics, which pose significant safety concerns for European consumers.
The Commission's scrutiny stems from a risk assessment conducted by Temu in October 2024, which was deemed insufficient as it relied on general industry data rather than specifics of its own platform. As a "very large online platform" (VLOP) with over 45 million monthly active users in the EU, Temu is subject to stricter regulatory obligations under the DSA.
The ongoing investigation also includes possible breaches involving addictive design features, transparency of recommendation systems, and consumer data access for researchers. If these infractions are confirmed, Temu could face a fine of up to 6% of its global annual turnover, reflecting the DSA’s enforcement powers over large digital platforms operating in Europe.
Temu, which has reached 100 million users in under a year, has stated it is cooperating fully with the Commission, which is currently awaiting the company’s response to the preliminary findings. The rapid growth of Temu has raised concerns about its compliance with the DSA.
The EU is making it clear that platforms that prioritize user safety will avoid serious consequences. Earlier this month, rival fast-fashion app SHEIN was fined €40 million in France for misleading business practices, serving as a stark example of the consequences for not adhering to EU regulations. The EU is focusing on enforcing the DSA's requirements for large platforms.
The Digital Services Act demands that platforms assess their risks based on their specific operations and take active steps to reduce harm. It requires large platforms to protect users through proper moderation and safety measures. Both Temu and SHEIN are currently under intense EU scrutiny.
In a mystery shopping test, baby toys and small electronics that did not meet EU safety standards were found on Temu's marketplace. The Commission's allegations against Temu highlight the importance of platforms adhering to the requirements of the DSA. The gross merchandise value of Temu in 2024 was $70.8 billion.
[1] European Commission Press Release, "Commission sends Statement of Objections to Temu over non-compliance with the Digital Services Act", 2025. [2] European Commission, "Digital Services Act", accessed 2025. [3] Reuters, "Temu faces EU probe over sale of illegal products", 2025. [4] The Verge, "Temu under investigation by European Commission for potential DSA violations", 2025.
The European Commission has expressed concerns about Temu's compliance with the Digital Services Act (DSA) due to its reliance on general industry data for risk assessment, instead of focusing on specifics of its own platform. In light of these concerns, the Commission has initiated an investigation into Temu, also questioning the app's transparency of recommendation systems, addictive design features, and consumer data access for researchers.
