The European Union has imposed a record €550 million ($629 million) fine on Alibaba-owned e-commerce platform AliExpress, according to reports from Reuters, POLITICO, and Associated Press. The penalty stems from allegations that the online marketplace failed to prevent the sale of illegal, counterfeit, and unsafe products, including toys and cosmetics. EU regulators determined that the online marketplace did not take sufficient action to curb the sale of prohibited goods, with many products reportedly remaining available on the platform for weeks even after being identified as illegal listings. As per Reuters, the fine was for conduct by the company until at least June 2025, when the commission issued a preliminary ruling that found AliExpress was not doing enough to tackle the sale of illegal products under the DSA. The €550 million sanction represents the largest fine ever issued under the DSA, surpassing previous penalties including a €120 million fine against Elon Musk's social media platform X in December and a €200 million fine on Chinese online retailer Temu in May.
According to the European Commission, the investigation found that millions of banned or non-compliant products repeatedly reappeared on the platform, with some illegal listings being recommended to users before eventual removal. The probe concluded that many sellers offering unlawful products continued to operate despite repeated violations. EU Commission Executive Vice-President for Tech Sovereignty, Security and Democracy Henna Virkkunen told reporters that "there were a lot of counterfeit products, unsafe toys and dangerous cosmetics which stayed online for a very long time." She emphasized that "products were still being recommended and advertised on the platform … even after it was already known that they did not meet the standards." Several items sold through AliExpress failed to comply with the bloc's stringent environmental and product safety regulations, as reported by Reuters. Virkkunen noted that "this is very dangerous for consumers, unfair for companies which are complying with all our rules." The commission specifically criticized AliExpress's recommender and advertising systems for exacerbating the spread of illegal products and its reliance on one quantitative indicator to measure its moderation system's effectiveness.
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. The €550 million sanction represents the third fine issued by the European Commission under the DSA, which requires very large online platforms to do more to counter illegal and harmful content. The Commission charged AliExpress in June last year with failing to comply with a DSA requirement to assess and mitigate the risks of dissemination of illegal products. As per Reuters, the company could face further penalties if the regulator decides in December that they do not comply with the DSA. The regulator criticized AliExpress's failure to properly evaluate whether it had enough people to review risks and overestimated the effectiveness of its system in detecting and removing illegal products. The penalty is the biggest ever imposed by the EU executive under the bloc's rulebook policing online platforms.
AliExpress criticised the "disproportionate" fine in a statement, which "ignores our sound risk management framework and the significant, proactive enhancements we have made," as reported by Reuters. The company added that it was "considering all available options" and will appeal the fine. In an email to Reuters, AliExpress said it disagreed with the "disproportionate fine, which does not adequately reflect our established framework and the significant, proactive enhancements we have made. We are carefully reviewing the decision and considering all available options." The company emphasized that since the DSA came into force, it "has been, and continues to be, firmly committed to meeting our obligations and we have invested substantial resources in risk assessment and mitigation, product safety and consumer protection." Virkkunen pointed to AliExpress's 193 million users in Europe last year versus Shein's 156 million and Temu's 130 million, noting that "one in five Europeans say they shop once a month from Shein, Temu and AliExpress."
Under the Digital Services Act, major digital platforms must regularly assess risks posed by their services and implement effective measures to limit the spread of illegal content and products. AliExpress has been ordered to pay the fine and submit a comprehensive compliance plan to EU regulators by October 20, 2026, outlining measures to address identified shortcomings. 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, which allows regulators to impose fines of up to 6% of a company's global annual turnover for serious breaches. The penalty comes less than three weeks after Alibaba said it will pay $600 million to resolve a dispute with the US government over allegations that the Hangzhou-based firm sold and imported illegal pharmaceuticals, controlled substances, regulated chemicals and pill-making equipment into the US. The commission said the novelty of the DSA was a mitigating factor in calculating the fine, which could have been higher.
