The European Commission (EC) has imposed a €200m ($233m) penalty on Chinese-owned online marketplace Temu under the Digital Services Act, concluding that the retailer did not properly evaluate the risks linked to illegal products sold through its platform.
In a statement issued on 28 May, the EC said: “The company failed to diligently identify, analyse, and assess the systemic risks of illegal products being offered on its platform and the resulting harm to consumers in the European Union.”
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The regulator said evidence collected during the investigation indicated that shoppers in the EU were “very likely” to come across illegal goods on Temu.
It added that the company’s 2024 risk assessment fell short of DSA standards because it was based largely on general e-commerce risk information rather than platform-specific evidence, including public reporting and testing related directly to Temu’s service.
Brussels said Temu also “seriously underestimated” how frequently consumers in the bloc could be exposed to unsafe or unlawful items.
As part of the probe, a mystery shopping exercise found that a large proportion of sampled chargers did not pass basic safety checks, while many baby toys tested were found to present medium to high safety risks.
According to the EC, those toy-related risks included chemical content exceeding legal thresholds and detachable components that could create choking or suffocation dangers.
The EC also said Temu failed to properly examine whether elements of its platform design, including recommendation tools and promotional programmes involving affiliated influencers, could heighten the circulation of illegal products.
Under the DSA, very large online platforms (VLOPs) are required to assess systemic risks associated with their services and take suitable steps to limit those risks.
The decision follows formal proceedings launched on 31 October 2024.
After issuing preliminary findings in July 2025, the EC has now closed the case with a non-compliance ruling.
The final decision was based on, among other things, Temu’s 2024 and interim 2025 risk assessment reports, material provided by third parties and results from an independent mystery shopping exercise.
EC tech sovereignty, security and democracy executive vice-president Henna Virkkunen said: “Temu’s risk assessment underestimates concrete risks, lacks specificity, is not grounded in solid evidence, and is not comprehensive.
“It leaves regulators, users, and the public in the dark about the true scale of potential harm posed by illegal products sold on Temu. Now it is time for Temu to comply with the law.”
In a statement emailed to Retail Insight Network, a Temu representative said the group “respects” the objectives of the DSA but “disagree[s] with the European Commission’s decision and consider[s] the fine to be disproportionate”.
The statement added that the company engaged constructively with the EC throughout the process and has since taken further steps to strengthen risk assessment, platform governance, and user protection.
The spokesperson commented: “We will continue to engage with regulators in good faith and work toward a marketplace that serves consumers, businesses, and communities responsibly. We are reviewing the decision carefully and considering all available options.”
Temu must submit an action plan by 28 August 2026 detailing how it will remedy the breach. Failure to comply could result in periodic penalty payments.
The EC said it will remain in contact with Temu to ensure it meets the requirements of the ruling and the broader DSA framework.
