Chinese e-commerce giants Shein and Temu have transformed the fashion landscape across Europe and the United States. In the U.S., Shein and Temu are challenging Amazon's dominance, while in Europe, they are reshaping the market by competing aggressively with established fashion retailers like Zara and H&M, reported The Times of India (TOI). The appeal lies in their ultra-low prices and vast product ranges, making long-standing retailers seem less competitive in comparison.
Zara and H&M are feeling the pressure, as Temu and Shein are often able to undercut their prices and deliver faster, feeding a growing demand for ultra-fast fashion in Europe.
Recently, however, Temu has come under scrutiny in Europe. The European Commission, the EU's executive arm, has reportedly launched an investigation into Temu, following suspicions that the company may not be effectively preventing the sale of illegal products. This probe, reported by the Associated Press, follows Temu's addition to the EU’s list of “very large online platforms,” which are subject to stringent oversight under the Digital Services Act (DSA).
The investigation centers on potential violations of the DSA, particularly regarding consumer protection, fair competition, and data privacy. The EU’s concerns focus on the sale of non-compliant goods, addictive design elements, and the transparency of recommendation algorithms. Regulators are also troubled by how easily “rogue traders” can reappear on the platform after suspension.
Temu, owned by China’s Pinduoduo, has stated its dedication to complying with EU regulations and safeguarding consumer interests. Nonetheless, the platform faces the risk of substantial penalties if the investigation uncovers significant breaches.
This action is part of a wider EU initiative to regulate tech giants and ensure a fair digital economy. Other platforms, including AliExpress, X, and TikTok, have also been subject to similar inquiries, demonstrating the EU's resolve to uphold rigorous standards for online businesses.
Inputs from TOI
Zara and H&M are feeling the pressure, as Temu and Shein are often able to undercut their prices and deliver faster, feeding a growing demand for ultra-fast fashion in Europe.
Recently, however, Temu has come under scrutiny in Europe. The European Commission, the EU's executive arm, has reportedly launched an investigation into Temu, following suspicions that the company may not be effectively preventing the sale of illegal products. This probe, reported by the Associated Press, follows Temu's addition to the EU’s list of “very large online platforms,” which are subject to stringent oversight under the Digital Services Act (DSA).
The investigation centers on potential violations of the DSA, particularly regarding consumer protection, fair competition, and data privacy. The EU’s concerns focus on the sale of non-compliant goods, addictive design elements, and the transparency of recommendation algorithms. Regulators are also troubled by how easily “rogue traders” can reappear on the platform after suspension.
Temu, owned by China’s Pinduoduo, has stated its dedication to complying with EU regulations and safeguarding consumer interests. Nonetheless, the platform faces the risk of substantial penalties if the investigation uncovers significant breaches.
This action is part of a wider EU initiative to regulate tech giants and ensure a fair digital economy. Other platforms, including AliExpress, X, and TikTok, have also been subject to similar inquiries, demonstrating the EU's resolve to uphold rigorous standards for online businesses.
Inputs from TOI
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