Temu accused of breaching the EU's DSA in a bundle of consumer complaints

Consumer protection groups across the European Union have filed coordinated complaints against Temu, accusing China's ultra-cheap e-commerce platform of a series of breaches related to the bloc's Digital Services Act (DSA). Temu only launched in the region about a year ago, but recently reported rockets past 75 million monthly users.

Sanctions for confirmed violations of the EU's online governance and market safety regime could amount to up to 6% of the platform's parent company's global annual turnover. For reference: Temu's parent Pinduoduo reported revenues of nearly $35 billion for 2023, nearly doubling from the previous year; Temu was estimated last year accounted for approximately 23% of that amount.

BEUC, the European consumer organization representing 45 regional consumer protection groups in 31 EU countries, said on Thursday it has filed a complaint against Temu with the European Commission – and is calling on the EU to urgently designate it as a “very large online platform” (VLOP) under the DSA. (VLOP status would mean Temu must comply with additional algorithmic transparency and accountability rules, including mitigating systemic risk. Other e-commerce VLOPs include Alibaba, Amazon, Booking.com, Google Shopping and Zalando.)

At the same time, 17 of the BEUC member organizations from across the bloc have filed DSA complaints with their national consumer protection authorities, accusing Temu of violating the general rules of the regulation that have applied to Temu since mid-February.

The coordinated complaints allege that the e-commerce giant is failing to comply with a range of DSA requirements, including merchant traceability requirements; rules against manipulative design; and transparency around product recommendation algorithms.

In a statement, Monique Goyens, director general of BEUC, accused the market of being “full of manipulative techniques” designed to entice consumers to spend more, and claimed there was insufficient information about traders who “regularly leave the market”.[es] consumers do not know whose products they are purchasing.”

“This lack of traceability prevents consumers from making an informed decision or knowing whether a product complies with EU safety rules,” she added.

The consumer protection groups are also raising concerns about the small security, noting that the extreme price discounts and gamification features baked into Temu's platform are likely to appeal to children.

“Temu does not guarantee its users a safe, predictable and reliable online environment as required by law,” they say in the complaint. “We are deeply concerned, among other things, that consumers are falling prey to manipulative techniques, that Temu is failing to guarantee the traceability of the traders operating on its platform, or that its overall operation remains opaque, all of which are contrary with the Digital Services Act. ”

“Ultimately, the large number of dangerous products sold on Temu by untraceable traders, through manipulative practices and opaque recommendation systems, are ingredients of a toxic cocktail that is likely to compromise the privacy, safety and security of minors,” the groups also warn.

The coordinated complaints follow several individual actions by consumer groups concerned about the safety and legality of products for sale on Temu's marketplace.

For example, last fall, Italian consumer group Altroconsumo conducted a test of cosmetics purchased on the platform and found that the vast majority did not list (or fully list) the ingredients. Earlier this year, the German consumer organization vzbv expressed concerns about misleading product reviews and price discounts displayed on the platform.

Because Temu is not currently a designated VLOP, supervision of the general rules of the DSA falls to competent digital service coordinators in the EU Member States where the service operates. Ireland's media watchdog, the Coimisiún na Meán, entered the picture when Temu opened an office in Dublin a year ago.

However, the complaint is likely to increase pressure on the EU to designate Temu as a VLOP. A Commission spokesperson told us it is aware of Temu recently reported more than 45 million monthly active users in the EU – which is the threshold for activating VLOP status – adding: “We are in contact with the platform with a view to a possible designation in the future. ”

Temu has been contacted for comment.

Last month, Shein, another Chinese e-commerce giant engaged in a fierce rivalry with Temu – including over international market expansion – was designated a DSA VLOP by the EU after reporting that it had crossed the 45 million MAU threshold .

While the EU opened its first marketplace DSA investigation in March, targeting another Chinese-owned e-commerce platform – Alibaba's AliExpress – which had been named a VLOP in the first wave of designations last April.

The Commission said at the time that it suspects AliExpress of violating DSA rules in areas related to risk management and mitigation; content moderation and the internal complaints handling mechanism; transparency of advertising and recommendation systems; traceability of traders; and data access for researchers. The investigation – one of several the EU has opened into VLOPs since last year's compliance deadline for these larger platforms – remains ongoing.

Related Posts

The search for the perfect artificial eye, through the ages

By tar, animal fat and gold threads to paint polymethyl methacrylate, or plexiglass, the nearly 5,000-year journey to perfect prosthetic eyes has been an odyssey through the periodic table. It…

If you use ad blockers, YouTube videos will now be skipped to the end

The number of users using ad blockers for websites and YouTube is increasing daily. However, Googling doesn't want this to happen and is taking all possible steps to address ad…

Leave a Reply

Your email address will not be published. Required fields are marked *

You Missed

Secret list of reasons why the president could lose revealed

  • May 28, 2024
Secret list of reasons why the president could lose revealed

Gael Monfils interview: Roland Garros, showmanship, Svitolina and Skai

  • May 28, 2024
Gael Monfils interview: Roland Garros, showmanship, Svitolina and Skai

Why I Love My CSA (It's More Than the Weekly Box of Fresh Produce)

  • May 28, 2024
Why I Love My CSA (It's More Than the Weekly Box of Fresh Produce)

DNC will nominate Biden and Harris through virtual proceedings ahead of the convention

  • May 28, 2024
DNC will nominate Biden and Harris through virtual proceedings ahead of the convention

Feeding peanuts to young children may reduce allergy risk: study

  • May 28, 2024
Feeding peanuts to young children may reduce allergy risk: study

Robert De Niro criticizes Trump outside the criminal trial

  • May 28, 2024
Robert De Niro criticizes Trump outside the criminal trial

A newly authenticated Caravaggio painting goes on display in Spain: NPR

  • May 28, 2024
A newly authenticated Caravaggio painting goes on display in Spain: NPR

Best non-gamstop casinos in 2024

  • May 28, 2024
Best non-gamstop casinos in 2024

California Catholic High School Stops Student's MAGA-Style Patriotic Speech (Video) | The Gateway expert

  • May 28, 2024
California Catholic High School Stops Student's MAGA-Style Patriotic Speech (Video) |  The Gateway expert

Air Force vets reveal how a top-secret base left them sick with tumors

  • May 28, 2024
Air Force vets reveal how a top-secret base left them sick with tumors

On other hockey worlds, European support for the Russian ban continues to hold

  • May 28, 2024
On other hockey worlds, European support for the Russian ban continues to hold