European Union Fines Temu 200 Million Euro Over Illegal Products — Temu Fine

EU regulators imposed a temu fine of 200 million euro on Thursday after finding Temu failed to protect consumers from illegal products. The penalty equals $232 million and comes under the three-year-old Digital Services Act.

Henna Virkunnen said Temu’s risk assessment was inadequate, and Temu said it considered the fine “disproportionate.” Temu has until the end of August to submit an action plan, or it could face additional daily, weekly or monthly fines.

Temu’s illegal goods review

The European Commission said Temu failed to identify, analyze and assess the systemic risks of illegal goods for sale on the platform. Investigators found non-compliant products during a mystery shopping exercise.

Among the products checked, many electronic device chargers failed basic safety tests. A very high percentage of baby toys also posed safety risks because some contained chemicals above safety limits or had parts that could come off and create a suffocation risk.

Henna Virkunnen’s warning

Virkunnen said in a prepared statement that risk assessments are “not box‐ticking exercises,” and that “Temu’s risk assessment underestimates concrete risks, lacks specificity, is not grounded in solid evidence, and is not comprehensive.” She added: “It leaves regulators, users, and the public in the dark about the true scale of potential harm posed by illegal products sold on Temu. Now it is time for Temu to comply with the law.”

Temu said the case related to the commission’s first DSA evaluation of Temu in 2024 and “does not reflect the current state of our systems.” Temu also said: “Temu engaged constructively with the Commission throughout the process and has since taken further steps to strengthen risk assessment, platform governance, and user protection,” while noting that it has 92 million users in the EU.

Digital Services Act pressure

The fine is only the second Brussels has issued under the Digital Services Act, after a $120 million penalty against Elon Musk’s social media site X. For Temu, the immediate consequence is simple: submit a satisfactory plan by the end of August or face more penalties that can be levied daily, weekly or monthly.