The European Union has intensified its investigation into Alibaba Group’s AliExpress for allegedly failing to prevent the sale of illegal products.

This probe, initiated in March 2024, aligns with the bloc’s enforcement of the Digital Services Act (DSA) aimed at regulating content moderation on major online platforms.

The European Commission said AliExpress has not done enough to penalize repeat offenders or moderate the content of items sold.

If confirmed, these violations could lead to fines under the DSA, which governs large platforms with over 45 million EU users.

AliExpress claims it is improving its detection systems for illegal goods and increasing seller accountability and transparency.

This case is part of a broader DSA enforcement push that also targets platforms like X, Meta, TikTok, Temu, and adult content sites.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ The DSA represents a milestone in platform accountability for illegal products

The EU’s action against AliExpress exemplifies the Digital Services Act’s approach to holding platforms responsible for illegal content, not just user posts.

The DSA, fully implemented on February 17, 2024, establishes strict requirements for all online platforms, with heightened obligations for platforms exceeding 45 million EU users 1.

Under this regulation, platforms face potential fines of up to 6% of their global annual revenue for non-compliance—a significant financial deterrent designed to ensure meaningful enforcement 2.

The DSA specifically requires online marketplaces to verify seller identities and implement effective mechanisms for users to report illegal products, directly addressing issues like those found on AliExpress 3.

This regulatory framework is part of a global trend toward increased platform accountability, with similar scrutiny emerging in other jurisdictions such as the US Consumer Product Safety Commission’s focus on foreign e-commerce platforms 4.

2️⃣ E-commerce platforms face massive scale challenges in policing illegal products

The sheer volume of counterfeit goods online demonstrates why platforms struggle with effective moderation despite having policies against illegal products.