Brussels has imposed a €200 million fine on Temu under the DSA for dangerous baby toys and defective chargers.

      The fine imposed on Temu represents the second-ever penalty under the Digital Services Act (DSA), following X’s €120 million fine in December. This marks the EU's first significant enforcement case against a Chinese platform concerning online safety.

      The European Commission has levied a fine of €200 million (approximately $232 million) against Temu, the Chinese e-commerce platform owned by PDD Holdings, for not adequately preventing the sale of unsafe products to consumers in Europe.

      The Commission's investigation revealed that a significant number of tested chargers from Temu did not meet basic electrical safety standards, and many baby toys presented medium to high safety risks, such as hazardous chemicals above EU legal limits and small detachable parts that could pose choking dangers.

      This fine is the second major enforcement measure taken under the DSA, following the €120 million penalty against X in December 2025.

      The Commission focused on a specific finding: Temu's risk assessment—a required document for large online platforms detailing how they address systemic risks—was deemed to underestimate actual dangers, lack specificity, be unsupported by solid evidence, and fall short of comprehensiveness.

      The way this is framed is important, as the DSA aims to penalize procedural failures rather than the mere existence of unsafe products. Other large platforms may also have unsafe products, but the Commission's case against Temu is that the platform failed to establish the necessary systems to identify and eliminate these products on a large scale.

      Temu must submit a remediation action plan by August 28, as per Article 75 of the DSA. The Commission has indicated its intention to scrutinize this plan closely, suggesting that further penalties could be imposed if the response does not meet the required standards.

      The fine of €200 million is on the lower end of the DSA's penalty spectrum; maximum fines can reach up to 6% of global annual revenue. For PDD Holdings, which reported $55 billion in revenue for 2025, this could translate to around $3.3 billion. The €200 million fine corresponds to about 0.4% of group revenue, suggesting it is more of a baseline penalty than a deterrent.

      An essential takeaway is the regulatory framework that the Commission is establishing. The DSA, effective since 2023 and with mandatory enforcement from 2024, was specifically created to empower European regulators with tools to enforce compliance against large online platforms, including those based outside Europe.

      The fine against X in December tested the DSA against a well-resourced US platform that has challenged the penalty in the EU General Court. In contrast, the Temu fine assesses the DSA's effectiveness against a Chinese platform with a unique commercial structure, including a parent company incorporated in the Cayman Islands and a marketplace reliant on millions of third-party sellers rather than first-party content.

      Concerns about Chinese platforms have been prominent among European regulators. Temu's business model, with many products sourced from small sellers shipping directly from Chinese manufacturing centers, highlights the very supply-chain visibility issues that EU product-safety laws aim to address.

      Moreover, Shein, another Chinese platform under the Commission's scrutiny, reportedly faces similar investigations.

      The Commission’s stance, as indicated by the Temu decision, shows that the structure of Chinese marketplaces will not justify inadequate risk assessments.

      Additionally, the political context is noteworthy. The Commission released its Tech Sovereignty Package on Wednesday and has been ramping up scrutiny of Chinese platforms concurrently. Meanwhile, Apple and Google are opposing Canadian encryption regulations, as Brussels signals its intention to enforce the DSA rigorously against both US and Chinese platforms.

      The Temu fine aligns with this broader strategy: prioritizing enforcement, emphasizing procedural compliance, and being scalable for repeat offenders.

      Both Temu and PDD Holdings opted not to comment further, apart from confirming the receipt of the Commission’s decision. The August deadline for the action plan represents the next tangible date in this ongoing case.