The European Union has launched a formal investigation into Chinese marketplace Temu, citing concerns that the platform sells illegal products and is designed to be addictive to consumers.
“There is a real suspicion that not enough has been done – and not effectively – to really prevent the spread of illegal products,” a European Commission official, who did not wish to remain anonymous, told reporters on Thursday morning. They say potentially illegal products include pharmaceuticals, toys and cosmetics.
Although Temu frequently removes illegal products, these products reappear very quickly, another official said. “We therefore believe that some of the existing controls are not working properly.”
Earlier this year, the industry association Toy Industries of Europe published a report warning that none of the 19 toys she purchased on Temu.com complied with EU regulations. After sending the toys to a lab for testing, they found that many of them posed solemn risks to children. The group found that the baby rattle had pointed edges and the chemical content of the Temu slime kit was 11 elements higher than the legal limit for toys.
“Our enforcement will ensure a level playing field and that each platform, including Temu, fully complies with the rules that keep our European market safe and fair for all,” Commissioner Margrethe Vestager, who oversees competition policy and digital.
Officials also raised concerns about Temu’s addictive design and recommendation systems, as they offer game-based rewards programs and endless scrolling.
Concerns about addictive design in Temu echo another recent EU investigation into the TikTok rewards program launched in April in France and Spain. TikTok Lite, the basic version of TikTok proper, offered users to pay a few cents a day to watch videos. Following the EU’s concerns, TikTok’s parent company, Bytedance, removed the feature from the region.
A Temu spokesperson told WIRED that the company is investing in its compliance system. “We will cooperate fully with regulators to support our shared goal of a safe and trusted market for consumers,” they said.
Ago only launched in Europe in April 2024, and its growth has been meteoric. By September, Temu had over 90 million users in the EU, meaning it is subject to the strictest regulations under the Digital Services Act. The law, which came into force last year, gives regulators the ability to impose financial penalties on companies of up to six percent of their global turnover. In March, AliExpress became the first marketplace to encounter the problem investigation in accordance with the Digital Services Act.
It can now provide data confirming that the EU’s suspicions are unfounded or it can make changes to the platform to avoid penalties. The investigation does not have to be completed by any specific date.
“This Commission decision is a promising step, but only a first,” Fernando Hortal Foronda, digital policy officer at the European Consumers Organization (BEUC), said in a statement on Thursday. “It is therefore important that the Commission maintains pressure on Temu and urges the company to comply with the law as quickly as possible.”