From TechCrunch: Temu, the low-cost e-commerce marketplace owned by Chinese online retailer Pinduoduo, is to face the European Union’s strictest rules after authorities designated the company a “very large online platform” (VLOP) under the Digital Services Act (DSA).
The news comes some two weeks after European consumer protection groups filed coordinated complaints against Temu over an alleged raft of alleged breaches relating to DSA, and a year after Temu opened its first office in the region. Temu subsequently went on to pass 75 million users in the EU, according to some reports, a figure that sits well above the EU’s 45 million threshold for being classed as a VLOP.
The general obligations set out under the DSA have applied since February, but an additional set of more stringent rules came into force last August, initially impacting 19 separate platforms designated as a VLOP or very large online search engine (VLOSE). This covered products belonging to Alibaba, Alphabet, Amazon, Apple, ByteDance, Meta, Microsoft and Snap, among others. In December, an additional three porn sites were given VLOP status, while Temu’s Chinese retail rival Shein was made a VLOP in April.
Temu is now the 24th company to face extra obligations under the DSA, meaning the company will face extra scrutiny over its use of algorithms, AI, content rankings, recommendation tools and suchlike, while having to assess and mitigate any “systemic risks” that stem from Temu’s services, including addressing counterfeit, illegal or unsafe products listed on its platform.
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