Chinese online retailer AliExpress has been given a record fine by the EU over the sale of illegal, unsafe and counterfeit goods.
The €550m (£467m) fine was the third issued by the European Commission under the Digital Services Act and the highest fine given so far.
The act requires tech and online platforms to do more to tackle illegal and harmful content.
The commission charged the online retailer with failing to assess and mitigate the risks of distributing illegal products in June last year.
AliExpress has a deadline of October 20 to propose remedial measures. It could face additional penalties if the regulator decides in December that the business does not comply with the act.
EU tech chief Henna Virkkunen said: “The spread of counterfeit clothing, unsafe toys, dangerous cosmetics and other illegal and harmful products is not an unavoidable cost of shopping online – it is a failure by AliExpress to comply with its obligations.”
She also referenced AliExpress’s 193 million customers in Europe last year and compared it to Shein’s 156 million and Temu’s 130 million users.
She added: “This is very dangerous for consumers, unfair for companies that are complying with all our rules. One in five Europeans say they shop once a month from Shein, Temu and AliExpress.
AliExpress said it would appeal the fine it feels is “disproportionate”.
The company said: “AliExpress has been and continues to be committed to meeting our obligations to consumers. We invest substantial resources in risk assessment and mitigation, product safety and consumer protection.
“Today’s decision and disproportionate fine ignores our sound risk management framework and the significant, proactive enhancements we have made. We will appeal the decision.”
The investigation found that AliExpress’s detection systems did not work efficiently as many illegal products were not flagged and others identified still remained for sale on the website. It also found penalties were not properly enforced on those selling illegal items.
The regulator criticised how easy it is for the “brand authorisation” system to be circumvented by illegal goods traders, and said the fine could have been higher.
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