The European Commission has fined Temu €200 million ($232 million) for failing to stop illegal and unsafe products from being sold on its platform. The penalty, announced May 28, 2026, is the largest ever under the Digital Services Act (DSA).
The two-year investigation found that Temu, owned by Chinese parent PDD Holdings, did not adequately identify or mitigate systemic risks tied to hazardous goods like faulty chargers and unsafe toys. As a Very Large Online Platform (VLOP), Temu was required under the DSA to conduct regular risk assessments and implement safety measures.
Temu has expressed disagreement with the decision. Regulators warn additional penalties could follow as the investigation continues.
This marks the second major DSA enforcement action. X, Elon Musk's platform, was fined €120 million in December 2025.
For investors, the message is clear: platforms must invest heavily in compliance or risk escalating fines that could reach up to 6% of global turnover. The EU is closing the liability gap for cross-border e-commerce, holding platforms directly responsible for products shipped directly to consumers.