The European Commission (EC) has just listed the cheap goods marketplace, Temu, as a Very Large Online Platform (VLOP) under the
Digital Services Act (DSA), meaning it will be under more scrutiny from the EU. The EC said that Temu became eligible to become a VLOP after it reported passing 45 million monthly users in the EU.
With this, Temu will now need to comply with the most stringent rules the DSA has to offer by the end of September. Some of these responsibilities include assessing and mitigating any systemic risk from its services. In Temu’s case, this means not allowing the listing or sale of counterfeit goods, unsafe or illegal products, or items that infringe on intellectual property rights.
The EU provides a long list of items that Temu must comply with. Notably, it will be responsible for publishing a transparency report once a year on their content moderation processes.
Going forward, the Commission and the Irish Digital Services Coordinator will supervise Temu’s compliance with the DSA. The Commission said it will be paying particular attention to consumer protection and the dissemination of illegal products; if it finds any issues it will let Temu know so that the issue can be sorted.
With Temu being designated as a VLOP, the Commission has now designated 24 companies as very large online platforms and search engines under the DSA. Just before Temu became a VLOP today, another online marketplace, Shein, became a VLOP on April 26 – Shein will have to comply with the rules by August 2024.
Companies that have to follow these rules, but don't, can be fined up to 6% of their global turnover. Afterward, they will be forced to take measures by the Commission before a deadline. At its discretion, the Commission can place non-compliant companies under enhanced supervision to ensure they meet DSA standards.
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