Temu and Amazon Under investigation according to recent reports by Reuters accessed by IA Law Firm Bosnia, the European Commission is investigating two global e-commerce platforms, Amazon and Temu, for alleged violations of consumer protection and competition laws. While the investigation into Amazon has not yet been formally launched (informal reports suggest it focuses on preferential treatment of its own products over competitors), Temu is already under investigation and facing accusations of selling unsafe products and employing addictive design elements.
Amazon: Preferential Treatment and Competition Violations
As one of the six technological “gatekeepers” identified under the Digital Markets Act (DMA) of September 2023, Amazon could face fines of up to 10% of its global revenue if found guilty of favoring its own products on its platform. Although the company publicly asserts compliance with laws and cooperation with the European Commission, there is growing anticipation that Teresa Ribera, the new EU antitrust chief, will formally launch an investigation into Amazon in early 2025.
Temu: Product Safety and User Addiction
Temu, a Chinese e-commerce giant with over 45 million monthly users, is under scrutiny for alleged violations of the Digital Services Act (DSA). It is accused of selling products that fail to meet European safety standards, including toys containing hazardous chemicals. More notably, the platform’s design practices aimed at fostering user addiction are a major area of concern.
The European Commission is investigating manipulative design practices, including:
- Infinite Scroll and Auto-Play Features: Tools that keep users engaged on the platform longer than intended.
- Rewards and Gamification: Incentives such as offers, points, and discounts designed to encourage frequent interaction.
- Customized Notifications and Algorithms: Features that create a sense of urgency and continuous connectivity.
These practices may lead to physical and mental health consequences, such as increased stress, sleep disorders, and negative impacts on mental well-being, particularly among young users. The Commission views such tactics as violations of consumer rights and distortions of market rules.
Wider Implications and Local Context
These investigations mark a pivotal moment in setting global standards for regulating digital platforms. IA Law Firm Bosnia raises the question of whether the EU’s initiative could inspire enhanced consumer protection locally. Developers and operators of digital platforms in Bosnia and Herzegovina should take note of the EU’s regulatory framework and avoid algorithms or manipulative practices that could attract scrutiny, even before formal decisions are made against global giants.
IA Law Firm Bosnia emphasizes the importance of engaging legal advisors when drafting specifications, contracts, and agreements related to developing and operating digital platforms to minimize risks in the long term.
Toward Stricter Global Oversight
These cases signal the beginning of stricter control over global tech giants and their societal impact, potentially serving as a model for future regulations worldwide. Although local competition authorities and consumer protection agencies in Bosnia and Herzegovina have not yet fully addressed digital platforms, these developments could guide future legislative progress.
IA Law Firm Bosnia is closely monitoring these investigations and awaits the EU’s official positions, preparing to address emerging legislative challenges and adapt best practices to benefit its clients in this rapidly evolving legal landscape.
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For more information on this topic visit: Commission opens formal proceedings against Temu under the Digital Services Act | Shaping Europe’s digital future
