The European Commission has accused Chinese e-commerce platform Temu of violating key consumer protection rules under the Digital Services Act, citing serious failures in risk management and product safety oversight.

In preliminary findings released Monday, the Commission said Temu had not adequately assessed or addressed the risks posed by illegal or non-compliant products on its platform, exposing millions of European consumers to potential harm.

The investigation, launched in October 2024, found that users of Temu are frequently exposed to unsafe goods, especially children’s toys and small electronic items that fall short of EU safety standards.

Central to the Commission’s case is Temu’s October 2024 risk assessment, which regulators deemed insufficient. Instead of using platform-specific data, Temu reportedly relied on generic industry information, failing to identify risks unique to its marketplace.

The company now faces the possibility of a fine of up to 6% of its global annual revenue if found in breach of the DSA.

“This may therefore have led to inadequate mitigation measures against the dissemination of illegal products,” the Commission said.

The DSA, which took effect in 2023, imposes strict requirements on digital platforms to maintain safe and transparent online environments.

For marketplaces like Temu, this includes actively preventing the sale of counterfeit or unsafe products.

Although the Commission’s findings are still preliminary, officials have warned of significant consequences if the violations are confirmed.

Temu will now have the chance to respond in writing and review the Commission’s evidence.

The European Board for Digital Services will also be consulted before any final decision is made.

“If the Commission’s preliminary views were to be ultimately confirmed, the Commission would adopt a non-compliance decision finding that Temu is in breach of Article 34 of the DSA.

“Such a decision could entail fines of up to 6% of the total worldwide annual turnover of the provider and order the provider to take measures to address the breach.

“A non-compliance decision may also trigger an enhanced supervision period to ensure compliance with the measures the provider intends to take to remedy the breach,” the Commission stated.