The United States, Germany, and South Korea have each conducted quality inspections on low-cost products sold by Chinese e-commerce platforms like SHEIN and Temu, discovering that many items are of substandard quality. (Internet screenshot)
People News: The EU technology regulatory agency stated on Tuesday (October 30) that it will initiate an investigation into Temu, a platform under the Chinese online retail giant Pinduoduo, to determine if this low-cost goods sales platform has violated EU regulations prohibiting the sale of illegal products. If found guilty, Temu may face substantial fines.
According to Voice of America, another focus of the EU’s investigation is the special design within Temu's service that makes it addictive for users, such as game-like reward programs and systems designed to recommend products for purchase.
After the pan-European consumer organization BEUC and its 17 member organizations lodged a complaint, the EU Commission launched the investigation under the Digital Services Act (DSA), which requires large online platforms like Temu to take more measures in dealing with illegal and harmful content on their platforms.
Temu is the overseas version of Chinese e-commerce giant Pinduoduo, with 92 million users in the 27 EU countries.
Temu has grown rapidly after entering the U.S. market for a few years. According to relevant statistics, in 2023, Temu’s shopping app was downloaded 120 million times, ranking first in the U.S.
The EU technology regulatory department also wants to investigate whether Temu complies with the EU’s Digital Services Act in allowing researchers to access its big data.
EU Commissioner for Competition and Digital Affairs Margrethe Vestager stated in a press release, “We want to ensure Temu complies with the Digital Services Act, especially to ensure that the products on its platform meet EU standards and do not harm consumers.”
In recent years, the EU Commission has intensified its regulation of online platforms to safeguard user rights and market order. In May this year, the EU Commission designated Temu as a “Very Large Online Platform” under the Digital Services Act, meaning the platform has more than 45 million active users in the EU market and thus must undertake stricter content regulation obligations, particularly in combating illegal content and counterfeit goods.
For platforms that do not comply with regulations, the EU can impose sanctions, such as fines and traffic restrictions, under this law. If Temu violates the Digital Services Act, it may face fines up to 6% of its global revenue.
For companies with repeated severe violations, the EU can impose the highest penalties, including banning them from operating in the EU market.
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