The EU is tightening regulations for Temu after Shein

Temu, a well-known Chinese e-commerce platform, will begin to face more stringent European Union (EU) rules after the European Commission designated it as a Very Large Online Platform (VLOP) in accordance with the Digital Services Act (DSA). Temu has more than 45 million monthly users in the EU, so it has to follow the strictest DSA regulations, especially when it comes to evaluating “systemic risks” like unlawful and counterfeit items.

Following Shein’s recent regulatory scrutiny, Temu faces similar oversight amid a complaint filed by the European consumer organisation BEUC. Allegations include a lack of transparency regarding algorithms and product sourcing and manipulative tactics to increase consumer spending.

Temu now has four months to submit its initial systemic risk assessment report to the Commission, with subsequent annual reports mandated. Additionally, it must implement enhanced consumer protection measures and publish biannual transparency reports on content moderation. Besides EU regulations, Temu also faces increased scrutiny in the US, with lawmakers considering potential import bans due to concerns over forced labour in its supply chain.