AliExpress faces fines of up to 6% of turnover: what happened
19 June 19:32
The European Commission has officially opened a case against the Chinese online platform AliExpress on suspicion of violating the Digital Services Act (DSA), a legislative act that regulates the responsibility of large online platforms for the security of content and goods. This was reported by "Komersant Ukrainian" with reference to the FT article.
The platform is accused of systemic failures in combating the sale of dangerous and illegal products, including counterfeit medicines, toxic children’s toys and other goods that may pose a threat to consumer health. According to the European Commission, the AliExpress platform sold products that have serious contraindications or do not meet safety requirements without proper control or warnings to customers.
The European Commission accused AliExpress of violating EU digital rules: what is known
According to Brussels, the popular Chinese marketplace:
- failed to properly assess the risks associated with the circulation of illegal goods;
- failed to provide an effective system for processing complaints and user reports;
- fails to comply with its obligations on transparency of advertising and recommendation algorithms;
- failed to ensure traceability of sellers, in particular within affiliate programs;
- failed to provide researchers with the necessary access to data as required by the DSA.
In addition, the platform failed to properly penalize violators, allowing them to re-post unsafe products under other names or accounts.
What is the DSA and why is it important?
The DSA is a key digital law that came into force in the EU in 2023. Its goal is to protect users from harmful content, misinformation, fraudulent products, and excessive data collection. Platforms with more than 45 million users in the EU have been granted the status of very large online platforms (VLOPs) and are now subject to the strictest level of control.
AliExpress has been on the list of such platforms since April 2023. Violation of the DSA can cost it a fine of up to 6% of its global annual turnover. AliExpress’ turnover is about $130 billion a year. In case of a systemic refusal to comply with the requirements, the European Commission has the right to block the platform within the EU.
This move by Brussels is part of a broader initiative to tighten regulation of Chinese online marketplaces, including Shein and Temu, which are also suspected of violations ranging from non-transparent operations to the import of dangerous goods.
According to former European Commissioner for the Internal Market Thierry Breton, “consumer protection is our priority,” and no platform “should be immune to responsibility.”
Read also: EU to tighten control over Temu and other online platforms
AliExpress in the EU’s crosshairs: the company’s response
In response to the accusations, AliExpress said it recognized the seriousness of the claims and was ready to cooperate. The platform has already provided the EU with legally binding promises, including
- strengthening control over partners
- verification of advertising content;
- restrictions on the sale of certain categories of goods;
- strengthening the moderation of ads.
AliExpress has also confirmed that it is in dialogue with the European Commission and plans to improve its internal supplier verification procedures.
“We are confident that a positive and compliant outcome will be achieved by continuing our mutual dialogue with the Commission to resolve any remaining issues regarding the Digital Services Agreement (DSA),” AliExpress said.
Prospects for AliExpress in the European market
The European Commission will continue the investigation. If it finds that the company’s measures are insufficient or superficial, the platform may be fined or temporarily restricted from operating within the EU.
This case will test the effectiveness of the new digital legislation, which is supposed to provide a single secure space for online commerce in the EU. Its outcome will have consequences not only for AliExpress but also for all foreign marketplaces operating in the European market.
AliExpress online marketplace: what information you need to know
AliExpress is an international online e-commerce platform established in 2010 by the Chinese company Alibaba Group. It specializes in retail sales of goods from Chinese manufacturers and suppliers around the world. AliExpress offers a wide range of products – from clothing, electronics, household appliances to cosmetics and accessories – at attractive prices.
The platform operates on the marketplace model: sellers post their products, and buyers can order them directly through the website or mobile app. AliExpress actively promotes the idea of affordable shopping by offering discounts, promotions, and free shipping to many countries.
At the same time, AliExpress has been repeatedly criticized for the low quality of some products, security issues, as well as copyright infringement and the distribution of counterfeit goods. In response, the platform is tightening controls and cooperating with regulators.
AliExpress remains one of the largest players in the global e-commerce market, with millions of users worldwide and an impact on the modern consumer landscape.
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