advertentieToday, the Commission preliminarily found Temu in breach of the obligation under the Digital Services Act (DSA) to properly assess the risks of illegal products being disseminated on its marketplace.
Evidence shows a high risk for EU consumers encountering illegal products on the platform. The Commissions mystery shopping analysis found that consumers on Temu are likely to find non-compliant products, such as baby toys and small electronics.
Temus risk assessment from October 2024 was deemed inaccurate, relying on general industry data instead of specifics about its marketplace, potentially leading to insufficient measures against illegal products.
The Commission will continue its investigation into other suspected breaches from October 2024, including the effectiveness of mitigation measures, the use of addictive design features, the transparency of recommendation systems, and access to data for researchers.
Next Steps
The Commissions preliminary findings are without prejudice to the investigations final outcome. Temu can exercise its rights of defense by reviewing the investigation file and responding to the findings. The European Board for Digital Services will also be consulted.
If confirmed, a non-compliance decision could find Temu in breach of Article 34 of the DSA, potentially resulting in fines up to 6% of its total worldwide annual turnover and requiring compliance measures. This decision may also lead to an enhanced supervision period to ensure compliance with remedial measures.
Background
On October 31, 2024, the Commission initiated proceedings against Temu. The investigation involves cooperation with national Digital Services Coordinators, customs authorities, and market surveillance authorities, adhering to the E-commerce Communication principles. It runs parallel to a separate investigation by the Consumer Protection Cooperation (CPC) Network and the first product safety sweep, ensuring a coordinated approach to addressing concerns about Temus practices.
The increase in online product sales in the EU is accompanied by a rise in unsafe, counterfeit, or non-compliant products, posing risks to consumer health and safety, the environment, and fair competition in the Digital Single Market.
The DSA mandates platforms to implement user-friendly mechanisms for reporting illegal content and appealing moderation decisions. It includes specific rules for online marketplaces, such as trader traceability, and prohibits dark patterns while detailing advertising and transparency obligations, including product recommendations.
For More Information
EU Official Journal text on the DSA
Very large online platforms and search engines under the DSA