EU finally
takes action
TEMU before.
EU finally
takes action
TEMU before.
from
Temu and other Chinese platforms are a thorn in the side of many European companies. This is because they not only offer products at low prices, but also products that clearly violate EU law. Now the EU Commission is finally taking action.
Fine against Temu
On 28.05.2026, the European Commission imposed a fine of 200 million euros on the Chinese online marketplace Temu. This is based on the Digital Services Act (DSA), the EU law that obliges large online platforms to actively manage the risks of their service. This is already the second severe fine under the DSA – following the 120 million euro fine imposed on Platform X (formerly Twitter) in December 2025. Brussels wants to send a signal: Anyone doing business in the EU must comply with European law.
What Temu is specifically accused of
Temu has been classified as a “Very Large Online Platform” (VLOP) since May 2024. This classification came after the company reported more than 45 million monthly users in the EU. This classification obliges the platform to comply with particularly strict due diligence obligations, including the obligation to identify, analyze and effectively combat the systemic risks of its service.
However, the Commission found that Temu had not fulfilled this obligation. For example, the company’s risk assessment from 2024 was based on general industry information instead of platform-specific data and findings. It also significantly underestimated how often EU users encounter illegal goods. Furthermore, Temu did not take into account how proprietary algorithms and influencer programs can further increase the risk of such products spreading.
The results of a mystery shopping test carried out by an independent testing organization on behalf of the Commission are particularly alarming. A very high proportion of the chargers tested failed basic electrical safety tests. In some cases, the limit values for harmful substances in baby toys were significantly exceeded and detachable parts posed a serious choking risk for small children. Customs and market surveillance authorities in the EU Member States also consulted data confirming high non-compliance rates for products sold on Temu.
The business model and its structural problems
Temu, a subsidiary of the Nasdaq-listed Chinese group PDD Holdings, pursues a business model based on extremely low prices. This model is made possible by direct relationships with manufacturers in China and an aggressive marketing strategy with influencer programs. From a legal perspective, this is precisely where a structural problem lies: if the prices are so low that they are below the production costs that would arise if safety standards, minimum wages and property rights were observed, the question arises as to where savings are being made.
Studies conducted by Stiftung Warentest in October 2025 confirm this suspicion with figures: Of 162 products tested – including children’s toys, jewelry and USB chargers purchased through Temu and Shein – 110, or more than two-thirds, did not meet EU standards. Toxic heavy metals in jewelry and chargers that ran too hot were among the findings.
Temu has described the EU fine as disproportionate and pointed to improvements made since the start of the investigation. However, the Commission found that both the 2024 risk assessment and the company’s subsequent comments did not meet the DSA requirements. Temu says it is considering all available legal remedies.
Trademark law and intellectual property
In addition to product safety risks, trademark infringements and product piracy are serious problems in their own right. As early as summer 2024, the Commission publicly criticized Temu for not taking sufficient action against the distribution of counterfeits. As part of an investigation, the Information Technology and Innovation Foundation (ITIF) in the US tested 51 suspicious products on the Temu, AliExpress and Shein platforms and found that almost half were suspected counterfeits, including luxury goods, cosmetics and household goods.
The German Retail Association (HDE) identifies the core problem: retailers offering counterfeit goods are often untraceable for German authorities as they are based outside the EU. The HDE is therefore calling for the appointment of a responsible economic operator based in the EU who can be held liable for misconduct by suppliers from third countries. Due to the sheer volume of small consignments, customs control mechanisms no longer work, meaning that the majority of illegal goods reach customers in the EU.
Shein: the same pattern
Temu is not an isolated case. The EU Commission has now also initiated proceedings against Shein for possible breaches of European consumer protection, in particular unfair contract terms and unfair business practices. Shein is also under increasing international pressure due to its business practices.
Conclusion
It is doubtful whether the EU Commission’s decision will lead to fewer illegal goods being offered on platforms such as Temu. After all, the business model of Temu & Co. is based on offering goods from Chinese manufacturers directly to customers worldwide at the lowest possible prices. The EU’s internationally very strict requirements will probably not be complied with in the future either, unless more draconian measures are taken.
Nevertheless, the fine is an important signal, also to domestic e-commerce, that the whole thing is not being watched idly. However, this action is only a first step in the right direction.
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