Additional Coverage:
- Temu, Shein and Amazon to be held liable by the EU for the dangerous and illegal products they sell, report says (newsbreak.com)
The European Union is preparing to crack down on unsafe and illegal products sold on popular online marketplaces like Temu, Shein, and Amazon Marketplace. A surge in low-value packages, mostly from China, has prompted the EU to consider stricter regulations.
The proposed reforms would require these marketplaces to provide more information about packages shipped to Europe. This increased transparency would allow for better control and inspection of goods. The EU aims to address growing concerns about unsafe products, counterfeiting, and unfair competition.
The sheer volume of these low-value imports has quadrupled recently, reaching a value of €4.6 billion. The EU proposal highlights the risks these products pose to consumers and the environment.
These marketplaces are already under scrutiny under the EU’s Digital Services Act, aimed at curbing the sale of harmful and illegal goods. Last year, the European Commission requested information from Temu and Shein regarding their efforts to address these issues.
Another potential change involves closing a tax loophole that benefits fast-fashion retailers. Currently, these retailers can ship packages without import duties applied to higher-value items.
Currently, online marketplaces are largely exempt from liability for goods sold by third-party vendors, unless there is evidence of deliberate or negligent oversight. The new proposal could shift this responsibility, requiring more direct oversight by the marketplaces. This could include customs checks and potential handling fees for each package, significantly impacting their current business models.
A new central EU customs authority would be established, using data from national authorities across the 27 member states. This centralized approach aims to improve coordination and enforcement of regulations.
While Shein has been operating for nearly two decades, Temu is a newer player that has rapidly gained popularity. Its ultra-low prices have attracted a large customer base, but the platform has also faced criticism regarding product safety and potentially addictive design features.
An EU investigation into Temu was launched last year, focusing on concerns about the platform’s safety for its millions of users. Concerns remain about the effectiveness of Temu’s efforts to prevent the sale of illegal products. A recent report further highlighted these safety concerns, finding that a significant percentage of toys purchased from various online marketplaces, including Temu, Shein, and Amazon, failed to meet EU safety standards.