In a move that may result in significant fines for the firm, EU tech authorities said on Tuesday that they will investigate Chinese online retailer Temu for possible violations of laws intended to stop the sale of illicit goods.
The potentially addictive features of Temu’s service, such as its game-like reward systems and its systems that suggest purchases to users, will also be the subject of the EU probe.
Following complaints from the pan-European consumer organization BEUC and 17 of its national members, the European Commission began its investigation under the Digital Services Act (DSA), which mandates that very large online platforms like Temu take more action to address harmful and illegal content on their platforms.
There is a genuine fear that insufficient efforts are being made to effectively stop the spread of illicit goods. Reporters were informed by an EU official that “rogue traders are resurfacing with new identities.”
Temu, a division of the massive Chinese e-commerce company PDD Holdings, said it will work with regulators. Temu has 92 million customers throughout the 27-nation European Union.
According to a statement from the firm, Temu takes its responsibilities under the DSA seriously and keeps making investments to improve our compliance system and protect the interests of users on our platform.
Additionally, the business said that it was in negotiations to become a part of a voluntary EU program to combat the selling of fake goods.
The EU tech enforcer will look into Temu’s compliance with the DSA’s need to make its publicly available data available to academics.
