The European Union has initiated an investigation into Temu, a major online marketplace, for allegedly allowing the sale of illegal products. Concerns focus on Temu’s compliance with the Digital Services Act (DSA). The European Commission is scrutinising Temu’s measures to restrict previously banned sellers from returning. Aggressive sales tactics on the platform are under review. A consumer group’s complaints triggered these actions.
The European Union has launched an investigation into the online marketplace Temu, concerned that the platform may be facilitating the sale of illegal goods. This move comes amidst fears that Temu’s operations are not in line with the Digital Services Act (DSA).
The European Commission has expressed worries that Temu lacks the necessary systems to keep previously suspended rogue traders off its platform. Reports indicate that some traders have managed to return within days of being removed, raising doubts about the effectiveness of Temu’s monitoring processes.
Another issue highlighted is the platform’s aggressive marketing strategies. Temu allegedly employs an ‘addictive design’ approach, which includes game-like rewards. This strategy may pose risks to consumers, prompting further investigation from the EU authorities.
Margrethe Vestager, the executive vice-president responsible for the Europe fit for the digital age portfolio at the European Commission, emphasised the need for compliance. She stated, ‘We want to ensure that Temu is complying with the DSA. Particularly in ensuring that products sold on their platform meet EU standards and do not harm consumers.’ This initiative aims to provide a level playing field in the digital marketplace, ensuring that platforms abide by the rules designed to protect EU consumers.
The investigation was initiated following complaints from a pan-European consumer group, which accused Temu of violating DSA terms by not providing essential seller information to customers. The complaint dates back to May, with additional reports from 17 other EU member states’ national authorities.
A representative from Temu has responded to these allegations, emphasising that they are suspicions rather than conclusive findings. They noted that the investigation seeks to determine if there is a ‘systemic’ issue on the platform.
The EU’s action underscores its commitment to ensuring digital marketplaces operate within the law to protect consumers.
