EU Investigates Temu for Illegal Products and Addictive Design—and Why Other Continents Should Follow Suit

The European Union (EU) has formally opened an investigation into the Chinese e-commerce platform Temu, scrutinising the company’s product offerings and user experience design amid suspicions of non-compliance with EU laws. Regulators allege that Temu is selling illegal products in the European market and is deploying an addictive interface that encourages prolonged consumer engagement. As the probe gains traction, it raises broader questions about the need for similar actions in other regions facing the rapid expansion of e-commerce platforms with potential regulatory and safety concerns.

Illegal Products and Safety Risks in Temu’s Catalog

One of the primary issues prompting the EU’s investigation is the sale of allegedly illegal products on Temu. An EU Commission official pointed out concerns that Temu’s measures to prevent illegal items from appearing on its platform may not be robust enough.

Pharmaceuticals, cosmetics, and toys sold on the site are among the items that may not comply with EU safety standards. For example, a report from Toy Industries of Europe earlier this year revealed that none of the 19 toys tested from Temu met EU safety standards. Dangerous items included a baby rattle with sharp edges and a slime kit containing chemicals far exceeding legal safety limits. Such lapses underscore the need for e-commerce platforms to ensure that the products they offer are vetted thoroughly to meet regional regulatory standards.

The risk to consumers, especially children, is significant when these platforms fail to adhere to established safety protocols. “Our enforcement will guarantee a level playing field and that every platform, including Temu, fully respects the laws that keep our European market safe and fair,” EU Commissioner Margrethe Vestager stated. Her words underscore the EU’s commitment to safeguarding consumer safety and maintaining strict compliance with its digital trade regulations.

Addictive Design and User Experience Concerns

In addition to concerns over product legality, the EU is also examining the “addictive design” strategies used by Temu to keep consumers engaged. The platform reportedly employs tactics such as infinite scrolling and gamified reward programs to extend user engagement. These features encourage frequent visits and prolonged browsing sessions, which can lead to impulse purchases and, potentially, contribute to overspending. Notably, this addictive design concern parallels an investigation the EU launched into TikTok earlier this year. TikTok’s “Lite” version, available in select European countries, was criticised for financially incentivising users to watch videos, a feature the company later removed from the EU.

Temu’s rapid growth in Europe highlights the allure of such user engagement strategies. Launched in the EU in April 2024, Temu amassed over 90 million users in just five months. This explosive growth may be partially attributed to the addictive design elements that encourage consumers to spend more time on the platform, thereby increasing revenue through impulse purchases.

Regulatory Challenges and Broader Implications

With Temu now subject to the EU’s strict Digital Services Act (DSA), it faces potential penalties of up to 6% of its global revenue if found non-compliant. This regulatory tool, introduced to maintain fair and safe digital practices, gives EU authorities unprecedented oversight over major online marketplaces. In March, AliExpress became the first company to be investigated under the DSA, and Temu now joins its ranks as the second.

The investigation requires Temu to either provide evidence disproving the EU’s allegations or make operational changes to align with regulatory demands. EU officials emphasize that this probe, although significant, is only the beginning of ensuring compliance from online platforms. Fernando Hortal Foronda of the European Consumer Organisation commented, “This decision by the Commission is a promising step, but only the first… It’s important the Commission keeps up the pressure on Temu.”

Why Other Continents Should Be Vigilant

Temu’s entry into markets outside of Europe, including Africa, North America, and parts of Asia, suggests a global expansion strategy. With the platform reaching millions of consumers worldwide, these issues are unlikely to be confined to Europe alone. The addictive design features and concerns over illegal products should serve as a cautionary tale for regulators worldwide, particularly in markets with weaker consumer protection frameworks. The enforcement of stringent safety and transparency standards across regions could help to address these risks more effectively.

Countries outside of Europe may also need to take a closer look at how platforms like Temu conduct business, particularly when it comes to ensuring product safety, combating addiction-driven design, and safeguarding consumer data. The EU’s regulatory action could provide a model for other nations seeking to protect their markets from similar risks.

Temu’s Response

In response to the investigation, a Temu spokesperson has stated that the company is investing in a compliance system and intends to work collaboratively with regulators to establish “a safe, trusted marketplace for consumers.” Temu’s willingness to engage with regulators will be crucial in determining the outcome of this investigation and its future in the European market.

The EU’s investigation into Temu reflects growing scrutiny of e-commerce platforms as consumer safety, product compliance, and ethical design practices become central issues in digital commerce. By taking a stand against potentially unsafe products and addictive user interfaces, the EU is setting a standard that could inspire similar regulatory action in other countries. Ensuring that platforms meet legal standards globally will be vital in maintaining consumer trust and upholding a fair digital marketplace.