FashionTemu to Face EU Probe Over Handling of Illegal...

Temu to Face EU Probe Over Handling of Illegal Product Sales

-

spot_img

[ad_1]

The European Union is set to launch an investigation into Temu over concerns it is failing to curb the sale of illegal products online, in a probe that could lead to hefty fines for the e-commerce service.

The European Commission will open formal proceedings against the platform — run by Chinese-owned PDD Holdings Inc. — to probe whether it is in breach of rules against illicit online activities, according to people familiar with the matter, who asked not to be identified discussing confidential conversations.

The investigation could be announced imminently, but the timing could also slip, as the Brussels-based executive body prepares for a changeover of its political leaders, the people said.

European regulators have been cracking down on Big Tech companies as part of an effort to curb online harms. Under the EU’s Digital Services Act, internet platforms with more than 45 million users in the region must take measures to stop the spread of disinformation and illegal content — including the offering of products that are illegal in the EU — or risk fines of as much as 6% of their global annual revenue.

A representative for Temu didn’t immediately respond to a request seeking comment. Following the EU’s formal probe, Temu has the right to propose the adoption of countermeasures to address the commission’s concerns and stave off potential penalties.

The probe follows the EU’s Oct. 11 request that Temu share data on how it tackles counterfeit or unsafe products on its marketplace. At the time, the commission said it had demanded “detailed information and internal documents on the mitigation measures taken against the presence and reappearance of traders selling illegal products” on Temu.

The information Temu has provided so far was unsatisfactory and did not allay the EU’s concerns, the people said.

PDD’s American depositary receipts fell 2.6% to $121.95 at 11:05 a.m. in New York after earlier dropping as much as 4.6%. The stock has declined 17% this year.

Temu has grown explosively since PDD introduced the service to expand in global markets, including a “Shop Like a Billionaire” Super Bowl ad in 2023 that quickly made it one of the most downloaded apps in the US. Its flash sales, game-like features and low prices pulled in consumers in dozens of countries around the world.

More recently though, PDD has warned that struggles could be ahead for the e-commerce giant, at a time competitors such as ByteDance’s TikTok and Alibaba Group Holding Ltd. are vying for budget-conscious shoppers, and Amazon is also plotting to rival Temu’s offerings.

PDD reported revenue of 97.1 billion yuan ($13.6 billion) for the June quarter, missing the average estimate of 100 billion yuan. Net income came to 32 billion yuan, compared to a projected 27.5 billion yuan.

In Brussels, EU regulators are wielding their online content rules against platform giants aggressively. The commission is currently carrying out DSA probes into Meta Platforms Inc., Alibaba Group Holding Ltd.’s AliExpress, Bytedance Ltd.’s TikTok and Elon Musk’s X Corp.

By Gian Volpicelli and Samuel Stolton

Learn more:

A Reality Check for Temu

Growth is slowing, competition is getting intense and regulators have the fast-fashion retailer in their sights. But despite investor panic over its prospects, Temu remains an e-commerce powerhouse — one that Western competitors must continue to watch.

[ad_2]

Source link

Latest news

WitchSpin Casino Review: Unveiling the Magic Behind the Reels

Online casinos are becoming more popular every day, and new ones are always entering the market. One of the...

Best Online Gaming Platforms for Norwegian Players Who Love to Travel

Norwegian players who enjoy gaming while traveling have the advantage of accessing some of the world’s most innovative and...

Non-Disclosure Agreement for Supply Chain Confidentiality

In today's globalized business environment, companies depend on strong and reliable supply chains to maintain their competitive edge. One...

The Science Behind a Successful Spot Bet

Spot betting, also known as micro-betting or in-play betting, is a dynamic form of wagering that allows bettors to...
spot_img

ZF 8HP50 prieš kitas pavarų dėžes: kuri geriausia jūsų automobiliui?

Automobilių pavarų dėžės technologijos sparčiai vystosi, o gamintojai nuolat siekia sukurti sistemas, kurios būtų našesnės, efektyvesnės ir patogesnės vairuotojams....

Maxx365 Online Casino: Spin, Win, and Thrive in a World of Excitement

The internet change has remade a lot, and fun is one of those things. Online casinos are now big...

Must read

WitchSpin Casino Review: Unveiling the Magic Behind the Reels

Online casinos are becoming more popular every day, and...

Best Online Gaming Platforms for Norwegian Players Who Love to Travel

Norwegian players who enjoy gaming while traveling have the...
spot_img

You might also likeRELATED
Recommended to you