In a historic enforcement action, the European Union has levied a staggering €550 million fine against the Chinese online retail giant AliExpress for systemic failures to prevent the sale of illegal products to European consumers. The penalty, announced on Monday, is the largest ever imposed under the bloc’s powerful Digital Services Act (DSA).
The European Commission concluded that the platform, a subsidiary of the Alibaba Group, violated its core obligation to diligently assess and mitigate risks linked to the dissemination of unlawful, dangerous, and counterfeit goods. The investigation, which lasted over two years, a marketplace rife with hazardous children’s toys, unsafe cosmetics, and fake designer apparel.
A System Overwhelmed by Fakes
Brussels launched its formal probe in March 2024 and found that AliExpress’s internal mechanisms for detecting prohibited items were fundamentally broken. Henna Virkkunen, the Commission’s Executive Vice-President for Tech Sovereignty, stated that investigators identified a vast quantity of counterfeits and dangerous products that remained available for purchase for extended periods.
“We spotted a large number of counterfeits, but also dangerous toys and cosmetics that stayed on sale for a very long time,” Virkkunen told journalists. The Commission further determined that penalties imposed by AliExpress on rule-breaking vendors were a paper tiger, as their storefronts continued to operate actively long after violations were flagged.
The investigation also revealed critical weaknesses in the verification systems for product compliance. The Commission noted that bad actors could bypass controls with ease, a problem exacerbated by understaffed moderation teams that were simply overwhelmed by the scale of illicit listings.
AliExpress Vows to Appeal “Disproportionate” Sanction
The Chinese e-commerce platform swiftly rejected the ruling, signaling a protracted legal battle ahead. In a statement, AliExpress expressed strong disagreement with the decision, calling the fine “disproportionate” and arguing it does not reflect the proactive measures the company has implemented.
“We disagree with the decision rendered today and with this disproportionate fine, which reflects neither our established principles nor the significant and proactive measures we have put in place,” the company declared, confirming it will appeal the decision.
Under the terms of the sanction, AliExpress is required to submit a comprehensive plan to the European Commission within three months detailing how it will bring its operations into full compliance with the DSA. Failure to do so will trigger additional periodic penalty payments.
A Wider Crackdown on E-Commerce Risks
However, Commission officials pushed back against the notion that AliExpress was singled out due to its Chinese origin. Virkkunen emphasized that active investigations are underway concerning numerous online platforms based in the United States, China, and Europe alike.
” do not take their origin into account, because everyone who wants to operate in Europe must respect the same rules,” Virkkunen stressed, framing the penalty as a universal standard of accountability rather than a targeted geopolitical measure. The decision follows a previous attempt by the group to settle other compliance failures with the EU last year, a deal that explicitly warned of further sanctions for unresolved issues.
