TCF POST Report
BRUSSELS — The European Commission has issued a €550 million fine against e-commerce platform AliExpress for failing to prevent the widespread sale of counterfeit clothing, unsafe toys, and dangerous cosmetics. The penalty stems from the platform’s failure to fulfill its obligations under the Digital Services Act (DSA) regarding the assessment and mitigation of systemic risks.
“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,” said Henna Virkkunen, Executive Vice-President for Tech Sovereignty, Security and Democracy. “Scale is not an excuse; risks must be identified and addressed systematically to ensure consumers can safely shop online.”
Failure to Protect Consumers from Counterfeit Clothing
A core focus of the Commission’s investigation was the prevalence of counterfeit apparel on the platform. The findings revealed that AliExpress’s mandatory “brand authorisation” system—designed to stop the sale of knock-off goods—was understaffed and ineffective.
As a result, malicious traders were able to easily bypass these safeguards, allowing large volumes of counterfeit clothing to circulate. The Commission noted that this not only deceives consumers but also unfairly penalizes legitimate fashion brands that invest heavily in design, innovation, and safety testing, forcing them to compete against products that bypass these essential investments.
Key Systemic Shortcomings
Beyond clothing, the Commission identified broader failures in how AliExpress manages illegal and unsafe products:
- Inadequate Detection and Removal: The platform overestimated the effectiveness of its moderation systems. Many illegal items, including counterfeit apparel, remained on the site for weeks despite being identified as non-compliant.
- Weak Enforcement: AliExpress failed to properly implement its penalty policies; stores that were sanctioned for selling illegal goods were often permitted to remain active on the platform.
- System Manipulation: The company lacked sufficient oversight to prevent traders from mis-categorizing items. By placing products in incorrect categories, sellers frequently bypassed compliance checks entirely.
- Insufficient Staffing: AliExpress failed to adequately evaluate whether it possessed the necessary human resources to moderate the massive volume of products appearing on its marketplace.
Mandatory Remedial Action Plan
The Commission has ordered AliExpress to submit a comprehensive, legally binding action plan by October 20, 2026. Under the Digital Services Act (DSA), this plan must outline “reasonable, proportionate, and effective” measures tailored to address the identified systemic risks.
To achieve compliance, the platform’s strategy must include specific improvements as mandated by Article 35 of the DSA:
- Algorithmic Adjustments: Testing and adapting recommender and advertising systems to stop the promotion of illegal and counterfeit items.
- Strengthened Moderation: Enhancing the speed and quality of processing notices regarding illegal content.
- Resource Reinforcement: Improving internal processes, staffing, and documentation to better detect systemic risks.
- Policy Enforcement: Adapting terms and conditions to ensure that enforcement against malicious traders is transparent and effective.
The European Board for Digital Services will review the proposal within one month of receipt. Following this, the Commission will issue a final decision and establish a timeline for implementation. Failure to comply with these requirements may lead to additional periodic penalty payments.
