The European Union (EU) has initiated an investigation into Temu to assess the company’s efforts in preventing the sale of illegal products on its platform. This inquiry is based on concerns that Temu may violate the new Digital Services Act (DSA), a regulation aimed at eliminating illegal content and misinformation online. If found in violation, Temu faces potential fines of up to 6% of its annual revenue.
The European Commission (EC) will evaluate Temu’s practices regarding transparency and data access, as well as its use of features designed to retain user engagement, amidst worries that illegal and dangerous products may be made available through the platform. Authorities have raised concerns that Temu has not taken adequate steps to combat fraudulent activities.
In response, a Temu spokesperson stated that the company is committed to cooperating with regulatory agencies and emphasizes its dedication to complying with the DSA. Additionally, Temu is investing in improving its compliance systems to safeguard consumer rights. The company is also in talks to join a voluntary agreement led by the EC aimed at tackling the online sale of counterfeit goods.
Temu is not alone in facing scrutiny; other major technology companies such as Meta, AliExpress, TikTok, and X are also under investigation related to DSA compliance as the EU seeks to establish itself as a benchmark for global tech governance.
As part of the ongoing investigation, Temu has been asked by the EU to provide detailed information and internal documents regarding its measures to address the presence of illegal products in its marketplace. Since its expansion into the global market, Temu has rapidly gained popularity, becoming one of the most downloaded apps in the United States, thanks in part to its flash sales, game-like features, and competitive pricing that appeal to consumers worldwide.