AliExpress Fined €550m Over Sale Of Illegal, Counterfeit Products

The European Union has imposed a record €550 million ($629 million) fine on e-commerce platform AliExpress for failing to curb the sale of illegal, unsafe and counterfeit products, marking the largest penalty issued so far under the bloc’s Digital Services Act (DSA).

The European Commission announced the sanction on Monday, saying AliExpress failed to adequately assess and mitigate the risks associated with the spread of illegal products on its marketplace.

The fine is the third issued under the EU’s Digital Services Act, a landmark regulation that places stricter obligations on very large online platforms to detect and remove illegal and harmful content.

The Commission had, in June 2025, charged AliExpress with breaching the DSA by failing to properly assess and mitigate the risks associated with illegal goods sold on its platform.

According to the regulator, the company failed to accurately evaluate whether it had sufficient staff to review platform risks and overstated the effectiveness of its systems for detecting and removing illegal products.

The Commission also criticised AliExpress’s recommendation and advertising algorithms, saying they contributed to the spread of illegal products. It added that the platform relied too heavily on a single performance indicator to measure the effectiveness of its moderation systems.

As a result, counterfeit goods, unsafe toys and dangerous cosmetic products reportedly remained available on the platform for weeks before they were removed.

The regulator further stated that AliExpress’s enforcement measures against offending merchants were ineffective, allowing sellers previously penalised for illegal activities to continue operating on the platform.

It also faulted the company’s mandatory “brand authorisation” programme, designed to prevent counterfeit sales, describing it as understaffed, ineffective and easily bypassed by traders selling fake products.

The latest penalty follows a series of enforcement actions by the European Union against major online marketplaces.

In July 2025, the EU raised concerns about Chinese e-commerce giant Temu, accusing it of breaching key consumer protection rules under the Digital Services Act. In a preliminary finding, the Commission said Temu failed to properly assess the risks posed by illegal or non-compliant products sold on its platform.

In May 2026, Temu was fined €200 million ($232 million) after regulators found illegal products, including dangerous baby toys and faulty chargers, being sold on its marketplace.

The European Commission said the company had “failed to diligently identify, analyse and assess the systemic risks” posed by the products and the potential harm to consumers.

Under the DSA, companies can be fined up to 6% of their annual global turnover for serious violations.

The €550 million sanction imposed on AliExpress significantly exceeds the €200 million fine imposed on Temu in May and the €120 million penalty issued against Elon Musk’s social media platform, X, in December, for separate DSA-related breaches.

AliExpress had previously avoided a financial penalty in June 2025 after agreeing to implement measures aimed at limiting the spread of potentially illegal and pornographic content on its platform.

Speaking after the decision, the EU’s technology chief, Henna Virkkunen, said the platform’s shortcomings posed significant risks to consumers and businesses that comply with the bloc’s regulations.

“This is very dangerous for consumers, unfair for companies which are complying with all our rules,” she said.

Virkkunen added that AliExpress had 193 million users across Europe last year, compared with 156 million for Shein and 130 million for Temu.

AliExpress, however, criticised the Commission’s decision, describing the penalty as excessive and disproportionate.

“We disagree with today’s decision and the disproportionate fine, which does not adequately reflect our established framework and the significant, proactive enhancements we have made,” the company said in a statement sent to Reuters via email.