• The EU has accused Temu of breaching the Digital Services Act by inadequately assessing illegal products.
• Preliminary findings indicate a high risk for EU consumers encountering counterfeit goods on Temu’s platform.
• If confirmed, Temu could face fines up to 6% of its annual global turnover.

The European Commission has initiated investigations into the Chinese online shopping platform Temu, accusing it of failing to adequately assess the risks associated with illegal products sold through its marketplace. According to the Commission, findings from a "mystery shopping" exercise revealed a "high risk" that consumers in the EU could encounter unsafe items like baby toys and electronic goods on Temu, as it has not implemented sufficient measures to prevent the sale of illegal products, which may lead to penalties of up to 6% of its annual global turnover, according to Reuters and Le Monde.

The investigation is part of the EU's enforcement of the Digital Services Act (DSA), designed to enhance consumer safety by holding e-commerce platforms accountable for the content they host. The Commission’s preliminary findings indicate that Temu's risk assessment, carried out in October 2024, relied on general industry data rather than specific information about its own marketplace, which could result in inadequate measures to mitigate risks for consumers, as reported in India Times and South China Morning Post.

The Commission has indicated that it will continue to investigate other aspects of Temu’s operations, including its use of addictive design features that may keep users shopping longer than intended and how it handles product recommendations. Temu, which has quickly amassed a significant user base in the EU since its launch in 2023, has expressed its intention to cooperate fully with the European authorities during the investigation, according to Reuters, Le Monde, and India Times.