Chinese online marketplace AliExpress has been handed a record €550m (£467m) fine by the European Union for failing to stop the sale of illegal and dangerous products – including unsafe toys, counterfeit clothing and hazardous cosmetics – to millions of customers across the bloc.
The penalty, announced by the European Commission, is the largest issued so far under the EU’s new Digital Services Act (DSA), a landmark law that forces major tech platforms to better police illegal and harmful content.
EU accuses AliExpress of ‘failure to comply’
Brussels concluded a two-year investigation by ruling that AliExpress had not met its legal duty to “diligently assess” the risks posed by illegal, unsafe or fake goods sold on its site.
“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,” said EU tech chief Henna Virkkunen.
Investigators found AliExpress’s systems for spotting banned or risky products “did not work properly”, with many illegal items never detected at all. Products that were flagged often remained on sale for weeks, the Commission said.
Officials also concluded that penalties against traders breaking the rules were not properly enforced, while product compliance checks could be “easily circumvented” by sellers.
AliExpress calls sanction ‘disproportionate’
AliExpress, which is owned by Chinese technology conglomerate Alibaba, criticised the ruling and said it would challenge it in court.
“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,” the company said.
“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 platform has around 193 million users in Europe, more than rival Chinese online retailers Shein or Temu, making it one of the bloc’s largest e-commerce gateways for low-cost imported goods.
Digital Services Act flexes its muscles
The case underlines the growing reach of the DSA, which came fully into force for the largest platforms in 2023. The law allows Brussels to impose fines of up to 6% of a company’s global annual turnover for serious breaches.
Alibaba reported worldwide revenues of €122bn last year, meaning the AliExpress penalty is well below the legal maximum but still the biggest imposed to date under the new rules.
Under the Commission’s decision, AliExpress must not only pay the fine but also submit a detailed action plan by 20 October outlining how it will fix the failings identified by regulators and prevent them recurring.
Other tech giants also targeted
AliExpress is the latest in a growing line of major tech firms facing DSA enforcement.
Earlier this year, Temu was fined €200m for allowing the sale of illegal products, including dangerous baby toys, on its platform.
Last year, Elon Musk’s social media platform X was ordered to pay €120m after the Commission said its paid blue tick verification system was deceptive because the platform was not “meaningfully verifying” who was behind the account, exposing users to scams.
The EU has signalled it will continue to intensify scrutiny of large digital platforms, arguing that stricter oversight is needed to protect consumers from unsafe products and misleading practices in an ever-expanding online marketplace.
