European Union technology regulators have imposed a €200 million ($232 million) penalty on the Chinese online shopping platform Temu for inadequately preventing the sale of prohibited merchandise, officials announced Thursday.
The substantial fine stems from the initial phase of an extensive investigation conducted under the Digital Services Act, legislation that mandates major online platforms take stronger action against illegal and dangerous content.
EU authorities launched their probe into Temu after receiving complaints from BEUC, a pan-European consumer advocacy group, along with 17 of its member organizations across different countries.
According to the European Commission, the EU’s executive branch, Temu failed to properly identify, analyze, and evaluate the systematic dangers posed by illegal merchandise on its marketplace and the potential harm to European consumers.
Regulators also criticized the company for inadequately examining how its recommendation algorithms and marketing programs involving affiliated social media personalities might increase the likelihood of illegal product sales.
The Commission has given Temu until August 28 to submit a comprehensive compliance plan, which officials will review before determining whether the company has sufficiently addressed DSA requirements within two months.
“This is about risk management. It is very much a cornerstone of our DSA,” EU tech chief Henna Virkkunen told reporters. “With this decision we are sending a very strong message to Temu.”
Virkkunen indicated that investigators will continue examining whether Temu’s platform design promotes addictive behavior, along with conducting broader evaluations of illegal product sales and data access for recommendation systems and researchers.
Under DSA regulations, companies can face penalties reaching up to 6% of their worldwide annual revenue for violations.
This marks the second major fine issued under the Digital Services Act, following a €120 million penalty imposed on Elon Musk’s social media platform X last December.
