The online commerce platform “Temu” is booming. According to its own statements, more than 92 million customers use it every month.
In Luxembourg, the online shopping application is the 5th most downloaded application. It’s no wonder: from electronics to clothing to toys, everything is available there directly from Chinese retailers, and therefore extremely cheap. Many items cost less than 10 euros.
But the platform is now in the sights of the European Union. The Commission launched formal proceedings against Temu at the end of October. As a “very large platform” with more than 45 million users per month, Temu must adhere to the European Digital Services Act (DSA), in force since February. This regulation requires platforms to act against the dissemination of illegal content.
Temu criticized for security risks
The investigation against Temu focuses on certain points, among others, the sale of products that do not comply with European standards. Furthermore, it is also a question of the design of the platform, which must be addictive: consumers are constantly encouraged to participate in various games. Furthermore, the way in which Temu recommends the user to make further purchases would not be transparent.
Consumer protection organizations criticize Temu because customers are allegedly lured into buying quickly with false discounts or deadlines. Additionally, many products would not comply with European safety standards, so there would be a risk of choking on toys for example.
For local retailers, the Chinese e-commerce giant represents strong competition, as the products are extremely cheap and reach the consumer without intermediaries. Additionally, just like other similar platforms, Temu is suspected of deliberately bypassing customs. Up to a value of 150 euros, you do not have to pay customs duties on goods arriving by air in the EU. Temu would deliberately split his orders to stay below this value.
Luxembourg can’t do much
The Minister in charge of consumer protection, Martine Hansen, recently responded to a parliamentary question on the subject. It appears that Luxembourg cannot do much on its own against packages that may be non-compliant or not correctly declared.
Even though with customs, ILNAS (Luxembourg Institute for Standardization, Accreditation, Safety and Quality of Products and Services), which controls whether goods meet EU security requirements, the Directorate of Consumer Protection and the Competition Authority, a number of authorities are responsible for the matter. Ilnas and customs can only carry out spot checks. In 2023, the Customs Administration detected 1,314 irregularities in imports during 15,722 checks, but these orders often arrive in Luxembourg via other EU countries, so customs here are no longer directly involved.
The Consumer Protection Directorate intervenes in the event of a complaint, but since the products are generally very cheap, few customers undertake such procedures in the event of a problem. However, in such cases, the ministry recommends contacting the Consumer Protection Directorate on its platform. This would then lead to an investigation at EU level.
