Brussels (Brussels Morning Newspaper) – EU launches formal investigation amid concerns Chinese shopping website Temu is breaching Digital Services Act.
The European Commission has opened formal proceedings to evaluate whether Temu may have violated the Digital Services Act (DSA) in areas connected to the sale of illegal products, the potentially addictive design of the service, the systems operated to recommend purchases to users, as well as data access for researchers.
What concerns are driving the EU’s investigation into them?
The European Commission stated it had numerous concerns that the platform, possessed by PDD Holdings, was breaching the new Digital Services Act. Among them are concerns that it does not have adequately robust systems in position to stop the reappearance of “previously discontinued rogue traders” with products re-emerging occasionally within days of being removed.
Is Temu doing enough to prevent illegal product sales?
According to a senior commission official concerns about selling counterfeit products, pharmaceuticals, cosmetics and toys had been submitted by various authorities across Europe, especially in Germany, Denmark and Ireland, where the firm is headquartered in the EU.
“We have received a lot of input from other authorities, but there is a real kind of suspicion that not enough is done, not in an effective way, to prevent the dissemination of illegal products.”
How does the platform’s design raise addictive concerns?
Furthermore, they suspected Temu had conducted “effective control systems” in place “reviewing and monitoring and screening what happens on their platform”. The commission is also concerned about the bold sales on the platform with an “addictive design” involving “game-like rewards”, with inadequate systems to “mitigate the risks stemming from such addictive design”.
In her remarks, Margrethe Vestager, the executive vice president in charge of the Europe fit for the digital age portfolio at the EU Commission, 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. Our enforcement will guarantee a level playing field and that every platform, including Temu, fully respects the laws that keep our European market safe and fair for all.”
