The European Commission has accused Chinese e-commerce company Temu of selling fraudulent items that do not comply with the standards of member countries. The Chinese company says it is taking the complaints very seriously.
The Temu application is the international version of Chinese e-commerce behemoth Pinduoduo, which was launched in 2015. By promoting unbeatable prices and free delivery, the app has quickly won over European and American consumers, to the point of overshadowing the giant Amazon. 45 million Europeans use the platform every month.
European Competition Commissioner Margrethe Vestager explained that she wanted to prevent European consumers from buying products that do not comply with European standards and are potentially dangerous. The Chinese company has been accused of failing to take the necessary steps to prevent the distribution on its platform of products considered illegal in Europe. These may include medicines, chemicals, or even children’s toys deemed dangerous according to European safety standards.
The Commission’s investigation, which opened on Thursday, October 31st, will also look into Temu’s commercial practices, such as the protection of user data and the operation of the algorithm to create consumer addiction. European consumer associations lodged a complaint against Temu in May, accusing it of using misleading interfaces to encourage users to spend more on the platform. The European executive is particularly interested in rewards programmes that are based on processes derived from online gambling to encourage users to win promotions, “which may have negative consequences for the physical and mental well-being of users.”
If found guilty, the Chinese group could face a fine equivalent to 6% of its annual turnover—around €720 million.
Six countries indicated their support for the investigation, including France and Germany. The company announced its intention to cooperate with the European authorities: “Temu takes its obligations under the Digital Services Regulation very seriously and is continually investing to protect the interests of consumers. We will cooperate fully with the regulators,” a spokesperson told AFP. Temu already received warnings several weeks ago, which were not acted upon, hence the launch of the investigation.
