Fines alone will not solve the problems brought about by the volume of junk
According to the Finnish Commerce Federation, fines alone will not be enough to solve the problems caused by e-commerce outside the EU. The European Commission’s decision to address the issues is welcome, but fines alone will not create the same rules for everyone. Regulatory changes are also needed.
Today, the European Commission has imposed a fine of EUR 200 million on Temu under the Digital Services Act. According to the Commission, Temu has not carefully identified, analysed and assessed the systemic risks related to the illegal products offered on its platform and the harm they cause to consumers in Europe.
The Finnish Commerce Federation welcomes the Commission’s intervention in the issues caused by distance selling outside the EU. Numerous reports show that there are significant shortcomings in product safety associated with platform sales directly from China to European consumers. In addition, competition is distorted when parties outside the EU avoid the costs of regulation.
“The message must be clear: if you sell to European consumers, you have to follow European rules. However, fines alone will not solve the basic problem. Sellers outside the EU are not subject to the same requirements as traditional operators in the commerce sector, so the Commission should reform the regulation and ensure the same rules for all operators,” says Kari Luoto, Managing Director of the Finnish Commerce Federation.
Increasing the platforms’ responsibility would fill the legislative loopholes that remained in the Digital Services Act. In practice, the regulation enables the marketing of products to consumers in the EU even if the products do not meet the requirements for products sold on the internal market. So far, the Commission has not been ready to specify the Digital Services Act.
“The situation can still be corrected later this year with legislative proposals to be presented in the EU. We hope that the Finnish government will influence the preparation of these in good time so that the issues around distance selling outside the EU can be addressed,” says Luoto.
In the autumn, the Commission will publish its proposal on the EU Product Act, the Circular Economy Act and the revision of the Consumer Protection Cooperation Regulation. They are important for ensuring equal competitive conditions and improving product safety.
For further information, please contact:
Kari Luoto, Managing Director, Finnish Commerce Federation, tel. +358 (0) 400 688 708, kari.luoto(at)kauppa.fi