EU Slaps Temu with Record 200 Million Euro Fine Under Digital Services Act

The Commission also criticized Temu's business model, noting that partially non-transparent recommendation systems and influencer advertising could further amplify the spread of illegal products. The company was required to analyze and minimize potential consumer harm and to ban corresponding merchants, but was found to have fallen short.

Before the fine was imposed, the European Commission had repeatedly called on Temu to conduct the required risk assessments under European digital laws. The company was classified as a very large marketplace by the EU Commission in 2024, subjecting it to stricter rules under the DSA.

Temu Disputes the Ruling

Temu operator Whaleco pushed back against the decision. The company stated it respects the DSA but considers the Commission's decision incorrect and the penalty disproportionate. A Whaleco spokesperson said the matter concerns the past and does not reflect the current state, adding that Temu has since taken further steps to improve risk assessment and consumer protection.

The company now has until August 28, 2026, to submit an action plan outlining how it will remedy the deficiencies to comply with European digital laws. The European Board for Digital Services will then have one month to issue its opinion on the plan, after which the Commission will decide whether the measures are sufficient. If the action plan is deemed insufficient, further penalty payments can be imposed.

A Growing Regulatory Crackdown

This is only the second time a violation of the Digital Services Act has been punished with a fine. The first was a 120 million euro penalty against platform X in December 2025. The DSA, which entered into force in 2022 and has been in effect since February 2024, requires very large online platforms with more than 45 million monthly active users in the EU to systematically identify and mitigate potential risks.

Proceedings under the DSA are also ongoing against Temu's competitor Shein, also from China. Those proceedings primarily concern an addictive platform design that allegedly prevents EU users from making informed purchasing decisions. A significant number of extensive DSA proceedings from the early phase of the regulation are still pending.

Under the DSA, fines of up to 6 percent of global annual revenue can be imposed, with the amount determined by the severity of the violation and the company's annual revenue. Temu can either challenge the fine before European courts or accept it.

According to an evaluation by the Federation of German Consumer Organizations, the five largest shopping platforms in Germany removed almost 70 million items in November 2025 alone, 30 million of which were classified as 'unsafe' or 'banned'.

Virkkunen concluded her criticism with a direct message: "It is time for Temu to comply with the laws."