EU Fines AliExpress €550 Million for Violating Digital Services Act (DSA)
The European Commission has levied a record €550 million fine against AliExpress, held by Alibaba, for failing to curb the sale of counterfeit and unsafe goods on its platform. This penalty, announced on July 20, 2026, is the largest yet under the EU’s Digital Services Act (DSA).
Key Findings: What Went Wrong at AliExpress
The fine stems from numerous failures identified by the Commission in its official statement:
- Inadequate Risk Assessment: AliExpress did not effectively assess or mitigate the risk of illegal, unsafe, and counterfeit products on its site.
- Insufficient Staffing: The platform did not have enough staff to review suspect listings.
- Flawed Moderation Metrics: It relied heavily on a single metric for moderation, which painted a misleadingly positive picture. Internal tests revealed that counterfeit clothing, unsafe toys, and hazardous cosmetics remained online for extended periods after being flagged.
- Recommender and Advertising Issues: Illegal products were promoted to shoppers before removal, exacerbating the problem.
- Enforcement Loopholes: A penalty policy for bad sellers was not enforced, allowing flagged stores to continue trading.
- System Gaming: Traders exploited loopholes by miscategorizing products and bypassing the platform’s "brand authorization" system due to staffing shortages.
Context: The Growing Impact of DSA Fines
AliExpress is the third major platform to face a DSA fine, after X (Elon Musk’s X) received €120 million in December and Temu €200 million in May. These penalties underscore the EU’s increasing willingness to enforce the DSA against global tech giants.
Consumer Protection vs. Red Tape
Henna Virkkunen, EU tech chief, emphasized consumer protection as the primary motivation behind the fine: "The spread of counterfeit clothing, unsafe toys, dangerous cosmetics, and other illegal and harmful products is not an unavoidable cost of shopping online. Scale is not an excuse." She also highlighted the negative impact on honest businesses that comply with rules.
Next Steps: A Chance to Rectify
AliExpress has until October 20 to present a plan to address the issues to the EU. National regulators will then review the plan, followed by a final decision from the Commission within an additional month. Failure to meet requirements could result in periodic penalty payments on top of the initial fine.