EU finds AliExpress violated digital safety rules

BRUSSELS (CN) — European regulators on Wednesday said Chinese shopping site AliExpress violated EU law by failing to properly stop the sale of illegal products on its platform, potentially exposing the company to fines up to 6% of its global revenue.

The EU’s main executive body, the European Commission, took two major actions against the Alibaba-owned platform under the bloc’s Digital Services Act. It accepted binding commitments from AliExpress to address concerns about advertising transparency and content monitoring systems. Second, it issued preliminary findings that the company violated requirements for identifying and removing dangerous or banned items.

Investigators found three main problems with how AliExpress handles illegal products. They argue the company minimized dangers shoppers face.

“AliExpress does not take into account the limited resources devoted to its moderation systems to avoid the dissemination of illegal products, thereby underestimating such risk,” the commission said in a news release.

The commission found AliExpress did not properly punish sellers who repeatedly posted illegal items, allowing them to keep selling banned products with little consequence.

According to the commission, the company’s automated systems for catching illegal products also had major flaws that made them easy for bad sellers to trick and bypass.

The violations involve requirements under the Digital Services Act, an EU law that took effect in February 2024 and forces large platforms serving more than 45 million European users monthly to check for and remove illegal content. This includes fake goods and products that don’t meet European safety rules.

The commission designated AliExpress and 16 other online platforms as Very Large Online Platforms in April 2023. Other major platforms under similar scrutiny include Facebook, Instagram, YouTube, TikTok, X, Amazon Store and Google’s services. The designation gives the commission direct authority to supervise and enforce compliance with the stricter requirements.

AliExpress agrees to binding fixes

In a parallel action, the commission accepted AliExpress’ commitments to improve several areas of its operations. These binding agreements cover the platform’s systems for detecting illegal products like unauthorized medicines and adult content, better complaint handling procedures, and increased transparency about how its advertising and recommendation systems work.

“Information and tools to limit the spread of illegal content will be easily accessible to both registered and non-registered users of the platform,” the commission said in describing the commitments.

AliExpress also agreed to set up internal monitoring with regular reports to an independent trustee who will provide annual updates to European regulators. Any violation of these binding commitments would immediately constitute a breach of EU law and trigger potential fines.

“The actions taken today show the strength of the Digital Services Act when it comes to creating a safer and fairer online environment,” said Henna Virkkunen, the Commission’s Executive Vice-President focused on digital policy. “We welcome AliExpress’ commitments towards becoming safer for users, fairer for legitimate traders, and a better online platform for all.”

AliExpress, owned by Chinese giant Alibaba, can now review the investigation documents and respond to the charges. The findings announced Wednesday are not final, and the company can defend itself before any penalties are imposed. If the violations are confirmed, the company could face fines up to 6% of its worldwide revenue under the Digital Services Act and be forced to fix its systems within a set deadline.

The commission opened its formal investigation into AliExpress in March 2024, focusing on the platform’s risk management practices, content moderation systems and compliance with EU safety requirements.

The case is an important test of whether European regulators can force major international tech companies to follow EU safety rules. AliExpress is among several big platforms now facing scrutiny under the new digital law as Europe tries to make online companies more accountable for protecting consumers.