Temu Got Slapped With Rs 2,200 Crore Fine, And The Reason Involves Your Child's Toys

Mystery shoppers hired by the EU went on Temu and found illegal products. What they discovered led to one of the biggest fines in European digital history.

The EU used a new digital rulebook to fine Temu $232 million.

Source : ABPLIVE AI

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Key points generated by AI, verified by newsroom

• EU fines Temu 200 million euros for failing consumer safety.
• Investigation found illegal, hazardous products like toys, electronics.
• Temu did not properly assess systemic risks of unsafe goods.

The European Union has fined Chinese online retailer Temu 200 million euros ($232 million) after an investigation found the platform failed to protect consumers from illegal and hazardous products. The penalty was issued under the Digital Services Act (DSA), a rulebook that requires online platforms to protect users from harmful content and unsafe goods. 

The fine follows preliminary findings from last year that flagged serious concerns about product safety on the platform, including baby toys and small electronics that did not meet EU consumer safety standards.

How Did The EU Reach This Decision Against Temu?

The European Commission based its decision on findings from its first DSA evaluation of Temu in 2024. Investigators conducted a "mystery shopping exercise" that uncovered several non-compliant products, including electronic device chargers that failed basic safety tests. 

A high percentage of baby toys were also found to pose safety risks, either because they contained chemicals above permitted safety limits or had small parts that could detach and become a suffocation hazard.

The commission said Temu failed to properly identify, analyse, and assess the systemic risks of illegal goods being sold on its platform. Officials described this as a particularly serious breach of EU digital rules.

"Temu's risk assessment underestimates concrete risks, lacks specificity, is not grounded in solid evidence, and is not comprehensive," said European Commission Executive Vice-President Henna Virkunnen. "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."

This marks only the second fine issued under the three-year-old DSA, after a $120 million penalty was handed to Elon Musk's social media platform X last year.

What Happens Next For Temu?

Temu, which has 92 million users in the EU and is owned by PDD Holdings Inc., said it disagreed with the ruling and called the fine "disproportionate." The company added that the decision relates to its first DSA evaluation and "does not reflect the current state of our systems."

"Temu engaged constructively with the Commission throughout the process and has since taken further steps to strengthen risk assessment, platform governance, and user protection," it said.

The platform now has until the end of August to submit an action plan addressing the violations. If it fails to comply, it could face additional daily, weekly, or monthly fines.

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