EU Slaps AliExpress with Record €550 Million Fine Over Illegal Product Sales

The European Commission has imposed a record fine of €550 million on Chinese e-commerce giant AliExpress for its failure to adequately prevent the sale of illegal, unsafe, and counterfeit products on its platform. This landmark decision marks the largest financial penalty ever levied under the European Union’s Digital Services Act (DSA), underscoring the bloc's intensified commitment to enhancing consumer protection across online platforms. AliExpress was found to have permitted the circulation of numerous illicit items, including counterfeit clothing, dangerous cosmetics, unsafe toys, and kitchen gadgets.

The comprehensive investigation, initiated by the European Commission in March 2024 with preliminary findings released in June 2025, determined that AliExpress had breached its obligations under the DSA. The probe revealed that the company lacked sufficient staff to review potentially illegal products, overstated the effectiveness of its detection and removal systems, and had advertising and recommendation systems that exacerbated the spread of illegal goods. Furthermore, millions of products flagged as illegal reportedly remained online for weeks, with moderators sometimes spending mere seconds to assess items.

This development brings regulatory risks within the e-commerce sector back into sharp focus. It highlights the increasing pressure on major online retailers to invest more significantly in compliance with stringent consumer safety and legal standards across their operating regions. While the fine represents less than 1% of the €122 billion revenue generated by AliExpress's parent company, Alibaba Group Holding (BABA), last year, it could impact the company's reputation and its operational strategies within the European market.

The Digital Services Act is a pivotal EU regulation designed to create a safer, more transparent, and fairer digital environment. Enacted in 2024, the DSA obligates very large online platforms (VLOPs) to combat illegal content and products, conduct thorough risk assessments, and protect users. This fine on AliExpress surpasses previous penalties under the DSA, including a €200 million fine for Temu and a €120 million fine for X, signaling the EU's escalating enforcement power in this domain.

AliExpress has expressed its disagreement with the decision, deeming the fine disproportionate. The company affirmed its commitment to fulfilling its DSA obligations and stated that it has invested substantial resources in risk assessment and mitigation efforts, product safety, and consumer protection. AliExpress announced it is carefully reviewing the decision and considering all available options. The European Commission has mandated AliExpress to submit a compliance action plan by October 20, cautioning that additional penalties could be imposed if the plan is deemed insufficient. Analysts anticipate that such regulatory actions will subject online retail platforms to stricter scrutiny and necessitate operational adjustments.