The European Commission has fined Chinese retail giant Temu €200m for failing to prevent the sale of illegal products on its platform, including those containing hazardous chemicals above EU limits, and breaching the bloc’s Digital Services Act (DSA).
The EU executive’s action is a clear warning to companies operating online marketplaces or selling on them that regulators are willing to impose significant fines when platforms fail to demonstrate robust, evidence-based risk assessments, particularly regarding product safety and hazardous substances.
Temu has faced scrutiny in recent years for selling non-compliant products, with lingering concern about those that contain hazardous chemicals. As a result, the EU executive launched an investigation into the company in 2024.
In a 28 May statement, the Commission said Temu’s risk assessment fell short of DSA standards, citing its failure to rely on platform-specific evidence, including public reports and testing.
It also found the company underestimated how frequently EU consumers encounter illegal products, including those exceeding chemical safety thresholds, and did not assess how its platform design could amplify such risks.
"Temu’s risk assessment underestimates concrete risks, lacks specificity, is not grounded in solid evidence and is not comprehensive," said Henna Virkkunen, the Commission’s executive vice president responsible for tech sovereignty, security and democracy.
Temu told Chemical Watch News & Insight that the Commission’s decision related to its first DSA assessment in 2024 and does not reflect the current state of its systems.
"Temu engaged constructively with the Commission throughout the process and has since taken further steps to strengthen risk assessment, platform governance and user protection," it said.
However, the company said it disagreed with the EU executive’s decision and considered the fine to be disproportionate. "We are reviewing the decision carefully and considering all available options," it said.