The European Commission has formally accepted an action plan submitted by Temu, the Chinese-owned online marketplace, to address breaches of the bloc's Digital Services Act (DSA). The announcement on Monday marks a step toward resolving a dispute that began with a formal investigation in October 2024 and culminated in a €200 million fine in May this year.
Under the plan, Temu has committed to conducting a comprehensive risk analysis, closely monitoring measures designed to prevent the sale of illegal products, and scaling up enforcement efforts where necessary. The company will also review how its recommender systems might amplify the spread of prohibited goods, a concern that regulators have flagged as a systemic risk on very large online platforms.
Background of the fine
The May penalty was imposed after Commission investigators found that Temu had failed to adequately identify and address risks associated with illegal and unsafe products sold to European consumers. Examples cited included dangerous baby toys and faulty chargers, which posed direct threats to user safety. As a designated Very Large Online Platform under the DSA, Temu is subject to stricter obligations regarding content moderation, transparency, and risk management.
Temu, which counts around 130 million users across the 27 EU member states—nearly a third of the bloc's population—has welcomed the approval. In a statement, the company said: “We appreciate the Commission's constructive engagement with us throughout the process.” It added that the plan “stands as a clear testament to Temu's commitment to investing in robust compliance infrastructure to ensure a safe, trustworthy shopping environment for all EU users.”
The approval comes as Temu and other e-commerce platforms grapple with new EU fees on low-value packages. Since July, parcels worth less than €150, which previously entered the bloc duty-free, are subject to a €3 handling fee. Industry observers note that the combined regulatory pressure is reshaping the business models of fast-growing online retailers.
While the Commission has not disclosed specific deadlines for the plan's implementation, it has indicated that it will monitor progress closely. Failure to deliver on the commitments could lead to further sanctions, including additional fines or operational restrictions.
The development is part of a broader EU push to enforce digital rules. In related news, the European Parliament recently backed the International Criminal Court with the Sakharov Prize, underscoring the bloc's stance on international law. Meanwhile, the EU's Arctic strategy has shifted toward security amid increased Russian and Chinese activity, reflecting a wider geopolitical awareness.
For Temu, the approval is a chance to reset its relationship with EU regulators. The company has invested heavily in compliance infrastructure, including dedicated teams for product safety and content moderation. However, critics argue that the plan's success will depend on rigorous enforcement and independent verification.
As the DSA continues to evolve, other platforms are watching closely. The outcome of Temu's case could set a precedent for how the Commission handles similar violations by other large online marketplaces operating in Europe.
