Alibaba’s AliExpress gets record €550 million EU fine over illegal product sales; Chinese firm to fight back

The European Union has imposed a record €550 million ($630 million) fine on Alibaba-owned e-commerce platform AliExpress, accusing it of failing to prevent the sale of illegal, counterfeit, and unsafe products, including toys and cosmetics, according to AFP.

EU regulators said the online marketplace did not take sufficient action to curb the sale of prohibited goods. Even after identifying illegal listings, many products reportedly remained available on the platform for weeks. Authorities also found that several items sold through AliExpress failed to comply with the bloc's stringent environmental and product safety regulations.

The penalty follows an investigation launched in March 2024 under the European Union's Digital Services Act (DSA), the landmark legislation introduced in 2022 to strengthen oversight of major online platforms and technology companies.

"Risks must be identified and addressed systematically to ensure consumers can safely shop online. Today, we are holding AliExpress to this standard and request it to take action," EU tech chief Henna Virkkunen said in a statement.

The €550 million sanction is the largest fine ever issued under the DSA. It surpasses previous penalties imposed under the law, including a €120 million fine against Elon Musk's social media platform X in December last year and a €200 million fine on Chinese online retailer Temu in May.

According to the European Commission, the size of the penalty reflects the seriousness of the violations, their duration, and the impact they had on consumers across the European Union.

AliExpress criticised the "disproportionate" fine in a statement, which "does not adequately reflect our established framework and the significant, proactive enhancements we have made".

The company added that it was "considering all available options".

AliExpress remains the largest Chinese online marketplace operating in the EU, serving around 193 million users. By comparison, fast-fashion retailer Shein has approximately 156 million users in the region, while Temu has about 130 million. A senior EU official noted that Europe is AliExpress' largest market globally.

Under the Digital Services Act, major digital platforms—including social media companies and online marketplaces—must regularly assess the risks posed by their services and implement effective measures to limit the spread of illegal content and products.

EU officials said their investigation found that millions of banned or non-compliant products repeatedly reappeared on the platform, with some illegal listings even being recommended to users before they were eventually removed. The probe also concluded that many sellers offering unlawful products continued to operate despite repeated violations.

The DSA forms a key part of the EU's broader regulatory framework aimed at increasing accountability among large technology companies. The legislation allows regulators to impose fines of up to 6% of a company's global annual turnover for serious breaches.

An EU official noted that Alibaba reported €122 billion in global revenue last year, making the €550 million fine significantly lower than the maximum penalty permitted under the law.

AliExpress has been ordered to pay the fine and submit a comprehensive compliance plan to EU regulators by 20 October, outlining the measures it will take to address the identified shortcomings. Failure to meet those requirements could expose the company to additional recurring financial penalties.

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