Under pressure, Temu must review his questionable sales practices

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Updated 06/18/2024 at 6:05 p.m.: following our publication, Temu exercised his right of reply. We have therefore added the brand's official declarations on the various issues raised in this paper.

Which e-commerce platform can claim to be as shady as Temu, available for a year in France ? A company that sells cheap, extremely dubious products , at a loss, and which resells the personal data of its customers en masse. The Chinese company that owns Temu, PDD Holdings, is registered in the Cayman Islands, a tax haven. The site is garish, bombarding you with promotions, affiliate codes, promotions on promotions, etc. Nothing inspires confidence when you walk there. In short, nothing is going well.

Already in the crosshairs of the French authorities for several months, Temu was targeted in May by a complaint from the European Consumers' Unions Bureau (BEUC ).

The DSA: Temu's Sword of Damocles

The Complaint in question was filed by the consumer defense association UFC-Que Choisir, which is part of BEUC. She accuses him of not complying with the requirements of the Digital Services Act (DSA). This regulation, established by the European Union, imposes on large digital platforms a set of strict rules, aimed in particular at fighting the marketing of counterfeit and potentially dangerous products.

With a number of monthly users approaching 45 million, Temu exceeds the critical threshold and is now categorized as a large platform. It must now comply by September. The DSA specifically targets companies that have thrived on lax internet regulation, and Temu is not the only one in the spotlight. AliExpress and Shein, two other Chinese giants, are also affected.

According to allegations by UFC-Que Choisir, Temu violates several aspects of the DSA, particularly by continuing to offer counterfeits and products that do not comply with European standards. The European Commission had already placed Temu under surveillance in April, a process which intensified with the filing of the recent complaint. A surveillance which revealed the shameful commercial practices of Temu, who does not hesitate to exploit regulatory loopholes by luring consumers with extremely low prices to sell them junk< /strong>.

“Regarding BEUC's complaint, we take it very seriously and will study it in full. depth, declares Temu in his right of reply. We look forward to continuing our dialogue with relevant stakeholders to improve Temu's service to consumers. When we identify areas for improvement, we look forward to working together to improve our service and address any gaps. We have consumers' best interests at heart and strive to provide safe and reliable service that is valued by consumers and adds significant value. We are committed to transparency and full compliance with all applicable laws and regulations.

A business model at risk< /h2>

Temu, like other similar platforms, has built its success on this economic model: the low-cost leads to the extreme. Pairs of sneakers, perfumes, watches, kitchen accessories and perfectly useless objects at prices sometimes 10 times cheaper than market standards.

Consumers are therefore being seduced by these attractive prices, while remaining aware of the increased risks inherent to this type of site in comparison with giants in the sector such as Amazon or Cdiscount. However, the new obligations imposed by the Digital Services Act (DSA) seriously call into question the sustainability of this economic model.

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An example of the economic and social toxicity that this type of business represents: Alexis Toupet, CEO of a French craft stamp company, had to close his business opened ten years ago. Its products were copied and marketed at unbeatable prices on Temu, forcing it to close its doors and lay off seven employees. A shame, quite simply, and this is just one example among many.

On the question of property intellectual, Temu said it has “paid close attention to feedback from brands and copyright owners, continually improving our intellectual property protection system”. And add:

In September Over the last year, we have moved from handling complaints by email to launching a dedicated IP protection portal for rights holders at https: //www.temu.com/intellectual-property-complaint.html, to allow them to more easily submit and track their files. Recently, we tested and beta launched an enhanced Brand Protection Center to facilitate more comprehensive coverage of designs and content ;similar images.We have significantly expanded our IP protection team as our business has grown, quickly improving the efficiency of handling complaints. Compared to our peers, we have significantly improved the speed of our takedown process, now resolving over 98% of takedown notices in just a few days, which is much faster than the industry average.
The effectiveness of our overall efforts to strengthen intellectual property protection is clearly demonstrated by the continued decline in the absolute number of complaints and their proportion in relation to our total volume of cases.

If Temu is forced to cease these activities as she currently practices them, its ability to attract consumers through ultra-competitive offers could be seriously compromised. Compliance with the DSA could result in a complete overhaul of its operations, making its future in the European market uncertain. Visibly aware of this risk, the company explains that its “objective is not only to respect the minimum legal requirements, but also to exceed them by adhering to the highest standards. highest standards in terms of best practices. To achieve this, it says it works “in close collaboration with [its] third-party sellers, the regulators, consumer groups and other stakeholders. And to conclude:

Temu is a newcomer to Europe, having entered our first markets just over a year ago. During this time, we have listened carefully to feedback from customers, regulators and consumer advocacy groups. We actively adjust our service to align with local practices and preferences, and we are committed to fully complying with the laws and regulations of the markets in which we operate (…) Our privacy interests Consumer interests are mutual and aligned. Our commitment to compliance and our desire to engage stakeholders globally is reflected in our proactive actions. Last week, Temu signed a cease and desist declaration with Germany's VZBV, pledging to address concerns raised about our practices, many of which are covered by BEUC's complaint. Additionally, in the previous three months, Temu signed a product safety pledge with the South Korea Fair Trade Commission, pledging to establish a comprehensive system to detect, prevent and remove dangerous products from circulation.

Temu strives to provide innovative and convenient services to consumers while prioritizing their safety. We operate with integrity and are guided by a set of core values ​​that always put consumers first. We are ready to cooperate promptly and diligently with stakeholders to ensure consumer safety and sustainable growth of the platform.

• Temu was the subject of a complaint by BEUC, with UFC-Que Choisir in its ranks.
• As a large platform, it will have to comply with DSA rules by September and stop the sale of counterfeit and dangerous products.

< li>A change that could completely disrupt its economic model.

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