Temu To Face Enhanced EU Online Content Regulations

As per media repoorts, the European Commission (EU) mentioned on 31 May that Temu, a fast-fashion e-commerce retailer under PDD Group (PDD.O), will need to adhere to stricter EU online content regulations. This is due to Temu's user numbers surpassing a critical threshold, placing it alongside major companies like Amazon (AMZN.O), Meta Platforms (META.O), and TikTok.

According to the European Union's Digital Services Act (DSA), platforms with over 45 million users are classified as very large online platforms (VLOPs). These platforms are required to take additional measures to combat illegal and harmful content, as well as counterfeit products. 

Temu, which entered the EU market in April of the previous year, averaged around 75 million monthly active users in the EU for the six months ending 31 March.

"Following today's designation as a VLOP, Temu will have to comply with the most stringent rules under the DSA within four months of its notification (that is by the end of September 2024)," stated the EU executive, which serves as the EU tech regulator, in a statement.

The DSA obligations for VLOPs include evaluating and addressing systemic risks associated with their services, such as the listing and sale of counterfeit goods, unsafe or illegal products, and items that violate intellectual property rights.

"We are fully committed to adhering to the rules and regulations outlined by the DSA to ensure the safety, transparency, and protection of our users within the European Union," Temu mentioned.

Violations of the DSA can result in fines of up to 6 per cent of a company's global annual revenue.