The European Commission suspects the Chinese online marketplace Ago to violate EU law. The Brussels authority initiated a formal procedure to check whether the platform was taking sufficient action against the sale of illegal products. In addition, the potentially addictive design of the service should be examined.
Among other things, the online marketplace is accused of not doing enough to combat illegal products. The commission said certain rogue traders would reappear on the platform after being blocked.
There is also a risk that the platform will become addictive through reward programs. This could have negative consequences for a person’s physical and mental well-being. The commission now wants to continue collecting evidence, for example through interviews.
Mitigate risks for consumption
In a preliminary investigation, the Brussels authority had already requested detailed information from Temu about the measures taken to prevent the re-emergence of traders selling illegal products on its online marketplace. The Commission also wanted information on how the risks to consumers would be mitigated.
The Brussels authority has already had similar proceedings against X (earlier Twitter), Tiktok and AliExpress opened. Large online platforms are being replaced by a new one EU Digital Services Act (DSA) obliged to take strict action against illegal content on the Internet.
In Germany, for example, after one and a half years on the market, Temu is already one of the largest online retailers in the country. According to a study by the opinion research institute YouGov belonging Consumer Panel Services GfKthe shopping portal landed in sixth place among the top online retailers based on the number of orders in the first half of 2024.
Poor quality, unfair competition
However, sales representatives, politicians and consumer advocates criticize, among other things, product quality, unfair competition conditions and a lack of controls. The platform rejects such allegations.
The Brussels trial against Temu comes at a time when economic tensions with China are rising. EU additional tariffs on electric cars imported from China have been in effect since Wednesday.
Before the EU Commission’s decision, a sufficiently large majority of EU states voted in favor of the punitive tariffs at the beginning of the month. Germany voted against the measure, fearing a major new trade conflict and possible retaliation against German manufacturers.