AliExpress Slapped with Record €550 Million EU Fine Over Illegal Product Sales

BRUSSELS — The European Commission today announced a landmark €550 million fine against Chinese e-commerce giant AliExpress, a subsidiary of Alibaba Group Holding, for widespread failures in preventing the sale of illegal, unsafe, and counterfeit products on its platform within the European Union. This penalty marks the largest ever imposed under the bloc's stringent Digital Services Act (DSA), signaling an intensifying regulatory crackdown on major online marketplaces and their accountability for consumer protection. The decision underscores the EU's resolve to enforce its digital laws, holding platforms responsible for systemic risks that could endanger millions of European consumers.

Breach of Digital Services Act Obligations

The substantial fine stems from a comprehensive investigation by the European Commission, which concluded that AliExpress had demonstrably failed to meet its obligations under the DSA to diligently assess and mitigate systemic risks related to illicit goods. According to the Commission, AliExpress did not adequately evaluate whether it possessed sufficient staff to review the vast array of potentially illegal products flooding its platform. Investigators found the company overestimated the effectiveness of its existing moderation systems, leading to a significant disparity between the volume of products needing scrutiny and the human resources allocated to the task.

A particularly critical finding was AliExpress's inadequate assessment of how its recommender and advertising systems could inadvertently exacerbate the spread of illegal products. Testing conducted by the Commission revealed numerous instances where illicit items were actively recommended or advertised to consumers, often before any effective removal could take place. The platform's risk assessments were also criticized for lacking crucial quantitative metrics, relying instead on a single indicator that failed to accurately measure the efficacy of its moderation efforts in preventing illegal products from appearing or reappearing in similar forms. These deficiencies point to a systemic failure in proactively safeguarding consumers from harmful content, a core tenet of the DSA.

The Pervasive Threat of Unsafe Goods

The consequences of these compliance shortcomings manifested in a persistent flow of dangerous and fraudulent products readily available to EU consumers. The Commission's investigation identified a wide array of illegal items, ranging from counterfeit clothing and unsafe toys to dangerous cosmetics and kitchen gadgets. Disturbingly, many of these illicit products remained online for multiple weeks, even after being identified and flagged by AliExpress's internal detection systems.

This unchecked circulation of non-compliant goods not only posed direct health and safety risks to consumers but also created an unfair competitive environment for legitimate businesses adhering to EU standards. Officials explicitly stated that the fine was not merely a reaction to the presence of illegal products but rather AliExpress’s fundamental failure to establish and implement robust barriers and mitigations as required by EU law. Moreover, the platform was found to have inadequately enforced its own penalty policies for traders involved in selling illegal products, further undermining efforts to curb the issue. This situation highlighted a broader concern within the EU regarding online marketplaces, particularly given that a significant majority, nine out of ten, of packages imported into the EU originate from China.

A New Era of Digital Regulation and Enforcement

The €550 million penalty represents a significant moment for the Digital Services Act, a groundbreaking piece of legislation that came into full effect in 2024, designed to create a safer, more predictable, and trustworthy online environment. The fine underscores the EU's commitment to rigorously applying the DSA to very large online platforms (VLOPs), which are designated based on their user numbers and therefore bear heightened responsibilities. This fine against AliExpress surpasses previous penalties issued under the DSA, including a €200 million fine against online retailer Temu in May for similar violations and a €120 million penalty against social media platform X last year.

Henna Virkkunen, the Commission's Executive Vice-President for Tech Sovereignty, Security, and Democracy, emphasized that "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 under the Digital Services Act." This statement reflects the EU's clear stance that the scale of an online platform does not excuse it from its responsibilities to protect consumers and ensure the integrity of its marketplace. The action against AliExpress is part of a broader ongoing effort by Brussels to scrutinize and regulate major Chinese e-commerce platforms, with companies like Shein also facing investigations over similar concerns.

AliExpress Responds and Faces Future Demands

In response to the European Commission's decision, AliExpress issued a statement expressing its disagreement with what it described as a "disproportionate fine." The company asserted that it has consistently invested substantial resources in risk assessment, product safety, and consumer protection measures since the DSA came into force. AliExpress indicated that it is carefully reviewing the Commission's decision and is considering all available options, which could include an appeal.

Despite AliExpress's reservations, the European Commission has mandated concrete next steps. The platform is now required to submit an action plan by October 20, 2026, detailing the specific measures it intends to implement to remedy the identified breaches of its obligations to assess and mitigate systemic risks. The European Board for Digital Services will then have one month to review this plan and issue its opinion, after which the Commission will adopt its final decision and set a reasonable period for implementation. Failure to comply with these requirements could result in further periodic penalty payments, signaling that the EU's scrutiny of AliExpress's practices will continue.

Conclusion: A Defining Moment for Digital Accountability

The record €550 million fine levied against AliExpress marks a defining moment in the European Union's ambitious push for digital accountability. It sends an unequivocal message to all large online platforms that operating within the EU market comes with significant responsibilities, particularly concerning consumer safety and the prevention of illegal content. The Digital Services Act is proving to be a powerful tool in shaping the conduct of global tech giants, ensuring that the convenience of online shopping does not come at the expense of consumer protection. As AliExpress works to address the mandated changes, the precedent set by this fine will undoubtedly influence the operational strategies of e-commerce platforms worldwide, fostering a more secure and trustworthy digital single market for millions.