European Commission Probes Temu For Flouting Norms To Sell Counterfeit Products

European Commission Probes Temu For Flouting Norms To Sell Counterfeit Products

If found guilty, the company could face a fine of 6 percent of its global turnover

The European Commission has stated that it is investigating Chinese online retailer Temu for breaching rules to sell illegal items.

The probe would also focus on the potentially addictive design of Temu's service, including its game-like reward programs, and systems to recommend purchases to users.

The action was taken under the Digital Services Act (DSA), which requires large online platforms to tackle illegal and harmful content.

The move came due to complaints by the pan-European Consumers Organization (BEUC) and its 17 national members.

A European Union (EU) official remarked, “There is suspicion that not enough is done in an effective way to prevent the dissemination of illegal products. Rogue traders are reappearing with different identities.”

Temu, which has 92 million users in the 27-country European Union and is a unit of Chinese e-commerce giant PDD Holdings, said it would cooperate with the regulators.

The company stated, "Temu takes its obligations under the DSA seriously, continuously investing to strengthen our compliance system and safeguard consumer interests on our platform.”

Tit added being in talks to join a voluntary EU initiative to counter the sale of counterfeit products.

The EU tech enforcer would also examine if Temu complied with the DSA obligation to provide researchers access to its publicly accessible data.

Margrethe Vestager, the EU antitrust and tech chief remarked, "We want to ensure that Temu is complying with the DSA, particularly in ensuring that products sold on its platform meet EU standards and do not harm consumers.”