The penalty, announced on July 20, is the largest imposed under the European Union’s Digital Services Act and marks a significant escalation in Brussels’ enforcement campaign against global technology and e-commerce platforms. Regulators said AliExpress had not adequately identified or reduced systemic risks facing consumers despite operating one of Europe’s largest online shopping services.
The Commission found shortcomings in the platform’s handling of counterfeit clothing, unsafe toys, hazardous cosmetics and other products that failed to meet European safety requirements. It also identified weaknesses in systems designed to detect prohibited listings, sanction repeat offenders and prevent removed goods from being offered again.
AliExpress said the fine was disproportionate and indicated that it would appeal. The company maintained that it had cooperated with regulators, strengthened product monitoring and introduced additional safeguards as compliance expectations developed during the investigation.
The Commission opened formal proceedings against AliExpress in March 2024, examining whether the company was meeting obligations applied to very large online platforms. Those services face stricter requirements because their scale can amplify consumer harm and allow unlawful products or content to reach millions of people.
AliExpress had about 193 million monthly users across the European Union during the latest reporting period, making Europe its biggest overseas market. Its designation as a very large online platform requires it to carry out detailed risk assessments, deploy effective mitigation measures and provide regulators with evidence that those systems work.
Investigators concluded that the company’s assessments underestimated the likelihood that consumers would encounter unlawful goods. Enforcement resources were also considered insufficient for the volume of listings, while some sellers were able to evade controls by placing goods in misleading categories or modifying product descriptions.
The Commission said AliExpress had introduced measures including brand-authorisation procedures and improved seller checks, but these steps had not delivered adequate protection. Products reported as illegal could remain available for extended periods, while enforcement against merchants with repeated violations was judged inconsistent.
The company must submit a comprehensive action plan by October 20 explaining how it will correct the deficiencies. Brussels could impose further measures if AliExpress does not provide satisfactory remedies or fails to implement them within the required timetable.
The decision establishes a new financial benchmark for enforcement of the Digital Services Act. Social media platform X was previously fined €120 million over transparency breaches, while Temu received a €200 million penalty connected to illegal-product risks. Shein has also faced scrutiny over its compliance with European digital and consumer-protection rules.
The legislation allows fines of up to 6% of a company’s global annual turnover. Alibaba generates tens of billions of dollars in yearly revenue, meaning the €550 million penalty remains below the maximum available to regulators, although it represents a substantial direct cost and could increase compliance spending across the group.
The action also reflects growing concern about the surge in low-value parcels entering Europe through marketplaces based outside the bloc. Billions of small packages are shipped to European consumers each year, creating difficulties for customs agencies and product-safety authorities seeking to inspect goods individually.
European officials have been considering additional handling charges for low-value parcels and tighter enforcement of customs, tax and safety rules. Such changes could affect the price advantage enjoyed by AliExpress, Temu and Shein, whose business models rely heavily on direct shipments from manufacturers and merchants to consumers.
Consumer groups have repeatedly highlighted risks involving electrical equipment, children’s products, cosmetics and household goods sold through third-party marketplaces. Counterfeit products also create losses for established brands and may expose buyers to materials or components that have not undergone required testing.
For Alibaba, the dispute adds regulatory pressure at a time when it is seeking stronger international growth outside its core domestic operations. AliExpress has expanded delivery networks, marketing campaigns and local merchant programmes across Europe as competition intensifies among discount-shopping platforms.
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