EU fines Temu for failing to stop sale of illegal and dangerous products

Lead

The European Union has fined Chinese-owned online retailer Temu €200 million ($232 million; £173 million) for failing to stop the sale of illegal and dangerous products on its platform. The penalty, announced on Thursday, is the largest ever imposed under the bloc's Digital Services Act (DSA), according to multiple sources.

The European Commission said Temu had "failed to diligently identify, analyse and assess the systemic risks" of the products offered and the potential harm to consumers, as reported by the BBC and Deutsche Welle. The fine follows a 19-month investigation that found consumers were "very likely to encounter illegal or unsafe products," including baby toys and electronics, per The Guardian.

Coverage Comparison

Coverage of the fine appears consistently across major outlets, with the BBC, Deutsche Welle, France 24, and The Guardian all reporting the €200 million penalty. The Guardian, which reported the most detailed account, noted the fine is the second-ever imposed under the DSA, following a €120 million penalty against Elon Musk's X platform in December. The BBC and Deutsche Welle also mentioned this precedent.

All sources agree on the core facts: the fine amount, the reasons for the action, and the directive for Temu to submit an action plan by August 28. France 24's report was shorter and more general, describing products as "toxic or unsafe" without specific details about the investigation. The BBC and Deutsche Welle provided direct quotes from EU officials and Temu's spokesperson, while France 24 did not.

Key Claims

• €200 million fine under the Digital Services Act: All sources confirmed the EU fined Temu €200 million for failing to comply with the DSA, which requires major online platforms to conduct risk assessments of potential dangers to consumers.

• 19-month investigation: The Guardian reported that the fine came after a 19-month investigation that concluded consumers were very likely to encounter illegal or unsafe products. Other sources noted Temu has been under investigation since October 2024.

• Mystery shopping findings: An independent testing organisation, acting on behalf of the commission, found a "high percentage" of chargers that failed basic electrical safety tests, and a "very high percentage" of baby toys that posed safety risks, including chemical levels above legal limits and small detachable parts that could cause suffocation, according to the BBC, Deutsche Welle, and The Guardian. The Guardian also mentioned unsafe clothes and jewellery.

• Temu's response: Temu disputes the fine, calling it "disproportionate," as reported by multiple sources. A Temu spokesperson said the company is "reviewing the decision carefully and considering all available options" and noted that the decision relates to 2024 and does not reflect its current systems, per the BBC.

• Action plan deadline: Temu must present an action plan to the European Commission by August 28 to address the concerns, with the commission then having two months to decide if it is sufficient, as reported by The Guardian and the BBC.

• Temu's user base and revenues: The Guardian reported that Temu has 130 million consumers in the EU and that its parent company, PDD Holdings, reported global revenues of $54 billion in 2024, though that figure includes income from another platform. A single source reported this revenue figure, and it was not repeated in other outlet coverage.

Perspectives

The EU's perspective, as presented by regulators, is that the fine sends a "very strong message" to platforms about their obligations under the DSA, according to EU tech commissioner Henna Virkkunen, quoted by the BBC. The commission argues the fine is proportionate given the seriousness of the breach, which involved inadequate risk assessment.

Temu's perspective, as conveyed by its spokesperson, is that the fine is disproportionate and that the company respects the need for clear rules but disagrees with the commission's decision. Temu maintains it worked "constructively" with regulators and is assessing its options, including the possibility of appeal.

Consumer safety concerns underpin the EU's action, as the mystery shopping exercise revealed significant numbers of non-compliant products, including chargers that could cause burns or electric shocks and baby toys with choking hazards. These findings were widely reported and uncontested by Temu in public statements, though the company disputes the overall fine.

The DSA, which has applied to the world's biggest tech companies since February 2024, is central to this case, as it mandates that platforms conduct thorough risk assessments and take action to prevent harm to consumers. This fine, as the largest under the act, is likely to be seen as a warning to other platforms, a point made by EU officials and echoed in media analysis.