Temu joins Shein in facing stricter regulation in the EU

Temu Subject to Stricter EU Regulations Under Digital Services Act

EU Designates Temu as VLOP
Temu, a Chinese online shopping platform, has been classified as a Very Large Online Platform by the European Commission, necessitating adherence to the strictest regulations under the Digital Services Act due to its large user base in the EU.

Mandatory Systemic Risk Assessments
The designation requires Temu to conduct thorough assessments of systemic risks such as counterfeit goods, illegal products, and intellectual property infringements, and submit an initial report within four months.

Increased Consumer Protection Measures
Temu is obliged to enhance consumer protection and provide transparency reports on content moderation every six months, ensuring greater accountability and consumer safety.

Global Regulatory Challenges
Besides the EU, Temu faces scrutiny in the US, where lawmakers have considered an import ban over forced labor concerns related to its suppliers.

Temu must implement several measures to comply with the Digital Services Act (DSA) now that it is classified as a Very Large Online Platform (VLOP). These measures include:

1. Assessing and mitigating systemic risks: Temu must assess and mitigate risks associated with its services, such as the listing and sale of counterfeit goods, unsafe products, and items that infringe on intellectual property rights6.

2. Providing risk assessment reports: Temu will have to provide the European Commission with risk assessment reports at the end of the four-month notification period and annually thereafter.

3. Reinforcing internal processes: Temu must reinforce its internal processes, resources, testing, documentation, and supervision of any activities linked to the detection of systemic risks.

4. Focusing on the wellbeing of underage users: The platform must pay special attention to the physical and mental wellbeing of its underage users, including implementing age assurance systems to restrict the purchase of age-restricted items.

5. Implementing strict measures for unsafe or illegal goods: Temu must put in place strict measures to prevent the sale of unsafe or illegal goods, such as modifying its user interface for better reporting and detection of suspicious listings, improving its moderation processes to swiftly remove illegal items, and refining its algorithms to prevent the promotion and sale of prohibited goods.

6. Adopting specific measures to empower and protect users: Temu must adopt specific measures to empower and protect users online, including minors, and duly assess and mitigate any systemic risks stemming from their services6.

7. Publishing transparency reports: Temu will be required to publish transparency reports on content moderation every six months.

These measures aim to ensure a safer and more transparent online environment for European consumers.