Temu, the budget-friendly e-commerce platform owned by Chinese retailer Pinduoduo, is set to adhere to the European Union’s most stringent regulations following its designation as a “very large online platform” (VLOP) under the Digital Services Act (DSA).
This announcement comes roughly two weeks after European consumer protection groups lodged coordinated complaints against Temu, citing numerous alleged violations of the DSA. It also marks a year since Temu established its first office in Europe. Reports indicate that Temu has now exceeded 75 million users in the EU, far eclipsing the EU’s 45 million user threshold for VLOP classification.
Additional scrutiny
The DSA rules have been enforceable since February, initially impacting 19 platforms assigned added scrutiny, either as VLOPs or very large online search engines (VLOSEs). These platforms include offerings from Alibaba, Alphabet, Amazon, Apple, ByteDance, Meta, Microsoft, and Snap, among others. In December, three additional adult sites were designated as VLOPs ahead of the official enforcement date. Temu’s competitor, Shein, was the first to be labeled a VLOP under the new regulations.
With Temu now as the 24th entity under these obligations, the company will face increased scrutiny concerning its use of algorithms, AI, content ranking mechanisms, recommendation systems, and more. It will be required to evaluate and mitigate any “systemic risks” originating from its services, including the handling of counterfeit, illegal, or unsafe products listed on its platform.
In mid-May, BEUC — the European consumer organization representing 45 consumer advocacy groups throughout the bloc — filed an official complaint against Temu, urging lawmakers to categorize the platform as a VLOP. Concurrently, over a dozen BEUC member organizations lodged complaints with their respective national consumer protection authorities, accusing Temu of DSA violations.
The European Commission appears to have responded to these concerns.
While the extra regulations for VLOPs officially become binding in August for companies already designated as such, Temu will have until the end of September to comply, given the four-month grace period from the notification date, effective today.
From this point onward, Temu must collaborate with the Commission and the Irish Digital Services Coordinator — Temu’s European headquarters is in Dublin — to submit regular risk assessment reports, starting one initially and continuing on an annual basis thereafter.
Truth Voices has reached out to Temu for comment, and will update this space if a response is received.
