The European Commission has imposed a fine of nearly $630 million on AliExpress, the Chinese e-commerce giant, for failing to prevent the sale of illegal and unsafe products on its platform. The penalty, one of the largest ever under the Digital Services Act (DSA), signals an aggressive enforcement stance against online marketplaces that do not adequately police their sellers.
The Fine and Its Basis
The fine, amounting to approximately €580 million, was levied after an investigation found that AliExpress had not taken sufficient measures to remove listings for counterfeit goods, unsafe electronics, and other prohibited items. The Commission cited systemic shortcomings in the platform's moderation and reporting systems, which allowed banned products to remain available to EU consumers for extended periods.
Under the DSA, which took full effect in early 2024, very large online platforms like AliExpress are required to implement robust content moderation, transparency, and traceability measures. They must also provide clear mechanisms for users to flag illegal content and cooperate with national authorities. The Commission determined that AliExpress had repeatedly failed to meet these obligations.
What the DSA Requires
The DSA mandates that platforms assess and mitigate systemic risks, including the dissemination of illegal goods. For e-commerce, this means verifying seller identities, pre-screening product listings, and promptly removing flagged items. AliExpress, with millions of third-party sellers, has faced criticism for not being able to scale these controls effectively, especially given the volume of cross-border transactions.
AliExpress's Response and Compliance
In response to the fine, AliExpress has stated that it will review the decision and consider an appeal. The company has also reiterated its commitment to improving product safety and compliance, pointing to recent investments in AI-driven moderation tools. However, the Commission's decision suggests that past efforts have been insufficient, and the fine is intended to compel more decisive action.
Implications for the E-Commerce Industry
This penalty is a clear warning to other online marketplaces, including rivals like Temu and Shein, which are also under heightened scrutiny in Europe. The fine demonstrates that the DSA is not just a paper tiger; the EU is willing to impose substantial financial penalties to enforce its rules. For consumers, it may lead to stricter product safety controls and fewer counterfeit goods, but it could also increase costs for sellers and platforms.
What Comes Next
AliExpress now has a set period to comply with the Commission's demands or face further sanctions. The case also adds pressure on the broader e-commerce sector to accelerate compliance, and we can expect more investigations and fines in the near future as the EU continues to enforce its digital rulebook.