The investigation will focus on Temu’s content and product recommendation systems as well as the sale of illegal products on the platform.

The European Commission has opened formal proceedings against Temu to assess whether the Chinese online retailer may have breached the EU’s Digital Services Act (DSA).

On October 11, the The Commission requested information from Temu regarding the mitigation efforts it has put in place against the illegal trade of products on its platform, as well as the risks arising from the platform for consumer protection, public health and user well-being.

She also asked Temu for information about its recommendation systems and the risks to the protection of users’ personal data.

The investigation, announced today (October 31), follows an analysis of the company’s response to the Commission’s request for information a few weeks ago, as well as the risk assessment report of Temu as well as information shared by third parties.

The Commission said it also relied on information shared by member states’ digital services coordinators, in particular Ireland’s Coimisiún na Meán, in making its decision regarding the formal investigation.

According to the Commission, the investigation will focus on the sale of illegal products on Temu, as well as the retailer’s integrated system to limit the re-emergence of previously suspended sellers who sold illegal products.

In addition, the European authority will also examine the risks associated with the addictive design of the platform, including “game-like” reward programs.

Temu, with a monthly user base of 75 million, has been designated very large online platform under the DSA earlier this year, meaning the company is subject to the “strictest rules” under the law as well as certain obligations under the law.

The formal proceedings opened today will further examine Temu’s DSA obligations related to its content and product recommendation systems as well as its obligation to give researchers access to its publicly available data.

The procedure, which the Commission has described as a “priority matter”, has no deadline and could have dramatic consequences for Temu, which could be fined up to 6% of its annual turnover global in the event of non-compliance.

However, this is not the first time Temu has fallen under the EU radar. In July, E-commerce giants Temu and Shein received official requests for information on the steps it has taken to comply with DSA obligations regarding user reporting of illegal products as well as to protect children on its platform.

Earlier this year, the EU used the DSA to take on Amazonasking online retail giant Amazon to share information about the transparency of its recommendation systems and their parameters. These are algorithms that suggest content to users based on data collected about those particular users.

Don’t miss out on the knowledge you need to succeed. Register at Daily BriefSilicon Republic’s summary of essential science and technology news.