the staff of the Ridgewood blog
Ridgewood Nj, the European Union has launched an investigation into Temu, a fast-growing Chinese e-commerce platform known for its low-priced clothing, home goods, and other products. With its increasing popularity, Temu has now attracted regulatory attention over concerns around privacy, safety, and user engagement practices.
Why the EU Is Investigating Temu
This year, the EU placed Temu on its list of major online platforms requiring closer scrutiny under the Digital Services Act (DSA). Introduced in 2023, the DSA mandates that large digital platforms meet EU standards for privacy, safety, and transparency, backed by the threat of significant fines. The EU’s investigation into Temu centers on three key areas:
- Blocking Noncompliant Goods and Traders: The EU is examining Temu’s efforts to prevent “rogue traders” from selling noncompliant or unsafe goods through the platform.
- Addictive Design Features: The EU is concerned with Temu’s gamified interface, which encourages extended user engagement. Authorities are questioning whether Temu’s app design may be addictive.
- Transparency of Algorithms: Under the DSA, platforms are required to reveal how their recommendation algorithms work, enabling researchers to better understand the influence of these algorithms on user behavior. Temu’s current compliance with this aspect of the DSA is under investigation.
Temu’s Growing Influence
Temu’s rapid rise since its entry into Western markets in 2022 has reshaped e-commerce in both the EU and the US, where it now has over 100 million users. In Europe alone, Temu has gained 92 million users, triggering a competitive response from other e-commerce giants. Amazon, for instance, is reportedly developing a similar platform to compete with Temu’s model, though a launch date for the new platform remains undisclosed.
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