The European Commission has imposed a record €550m (£467m) fine on Chinese e-commerce giant AliExpress for failing to prevent the sale of illegal products on its platform, according to BBC News. The penalty is the highest ever under the Digital Services Act (DSA), which requires large online platforms to actively counter illegal and harmful content.
What Changed: The DSA Violation
The European Commission ruled that AliExpress breached its obligation under the DSA to "diligently assess" the risk of illegal, unsafe, or fake goods on its marketplace. A two-year investigation uncovered systemic failures:
- Detection systems "did not work properly": Many illegal products were not flagged at all.
- Delayed removal: Even when illegal items were identified, they remained on the site for several weeks.
- Weak enforcement: AliExpress did not properly enforce penalties against traders selling illegal goods.
- Circumventable checks: Product compliance checks could be "easily circumvented".
Who Is Affected
AliExpress, owned by Chinese tech conglomerate Alibaba, serves 193 million users in Europe — more than fellow Chinese retailers Shein and Temu. The fine directly impacts Alibaba, which reported a global turnover of €122bn last year. The DSA applies to all very large online platforms (VLOPs) with over 45 million monthly active users in the EU.
| Platform | Fine (€) | Status |
|---|---|---|
| AliExpress | 550 million | Record fine, must submit plan by 20 October |
| Temu | 200 million | Earlier fine for similar violations |
| X (formerly Twitter) | 120 million | Fined for deceptive blue tick badge practices |
| Shein | Under investigation | Not yet fined |
Compliance Obligations and Deadlines
Under the DSA, companies must:
- Implement effective detection and removal systems for illegal or harmful content.
- Enforce penalties on non-compliant traders.
- Ensure product compliance checks are robust and not easily circumvented.
- Cooperate with regulators during investigations.
AliExpress is now required to pay the €550m fine and present a detailed plan to the European Commission by 20 October outlining actions to address the breaches.
Penalties for Non-Compliance
The DSA permits fines of up to 6% of a company's global annual turnover. While Alibaba's €122bn revenue would theoretically allow a fine of up to €7.3bn, the Commission imposed €550m, noting that the penalty reflects the gravity of the violations but remains proportionate.
"Scale is not an excuse for selling dangerous or illegal goods. 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." — Henna Virkkunen, European Commission Executive Vice President for Tech Sovereignty, Security and Democracy
Industry Impact and Guidance
This is the third fine under the DSA, following penalties on Temu (€200m) and X (€120m). Shein remains under investigation. The enforcement signals the EU's intent to hold large platforms accountable for product safety and counterfeit goods. Trade compliance officers should monitor DSA obligations for their own platforms, particularly regarding detection systems and trader vetting. The European Commission has not yet issued specific guidance for this case, but the AliExchange decision underscores the need for robust compliance frameworks.
AliExpress stated: "We disagree with today's decision and the disproportionate fine, which does not adequately reflect our established framework and the significant, proactive enhancements we have made. We are carefully reviewing the decision and considering all available options."
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