Alibaba's AliExpress hit with record 550 million-euro EU fine for counterfeit goods

EU fines AliExpress record €550 million for failing to tackle sales of illegal, unsafe and counterfeit products.

Objective Facts

Alibaba's AliExpress was hit with a record €550 million ($629 million) fine from the European Union on Monday for failing to tackle sales of illegal, unsafe and counterfeit products on its platform. The fine was the third issued by the European Commission under the EU's landmark Digital Services Act, which requires very large online platforms to do more to counter illegal and harmful content. Large volumes of illegal products – including unsafe toys and dangerous cosmetics – continued to circulate on AliExpress despite moderation efforts, and the Commission found that AliExpress failed to properly enforce its penalty policy, allowing stores selling illegal products to remain active on the platform even after receiving sanctions. The Commission took into account the nature, severity, and duration of the violations, which persisted at least until June 2025. AliExpress must set an October 20 deadline for proposing remedial measures, and the company could face further penalties if the regulator decides in December that they do not comply with the DSA.

Deep Dive

The EU's Digital Services Act, which entered force in 2022, represents an unprecedented regulatory framework for governing large online platforms across the bloc. The AliExpress decision reflects a broader shift in the EU's enforcement focus under the DSA, moving beyond social media platforms toward online marketplaces that facilitate the sale of physical goods. Early DSA cases largely centered on content and transparency issues on platforms such as X and Meta. The AliExpress and Temu cases involve products that regulators say may pose direct safety concerns for consumers. The Commission said AliExpress had not properly evaluated whether it had enough people to review the risks and had overestimated the effectiveness of its system in detecting and removing illegal products. The question of how recommendation and advertising systems further exacerbate the distribution of illegal products was also insufficiently investigated. Tests by Commission departments showed that numerous illegal products were actively recommended to or advertised to consumers before being removed from the platform. AliExpress complained that the fine was "disproportionate" and "does not adequately reflect our established framework and the significant, proactive enhancements we have made." The company's position rests on claims of substantial investment in compliance, though the Commission's investigation found these investments insufficient in practice. Temu's earlier deadline on Aug. 28 will provide the first indication of how the Commission evaluates post-fine compliance plans from marketplace platforms — and how much weight the Board's opinion carries when the two institutions disagree. Whether that process produces structural change or paper commitments is what the second half of 2026 will show. Europe's dealings with Beijing have been increasingly defined by a huge trade imbalance and tension over what Brussels says is overproduction by Chinese manufacturers benefitting from large industrial subsidies. EU leaders such as Ursula von der Leyen warned early this month that the bloc is weighing action to address its trade imbalances with Beijing. They say Europe is being flooded with cheap Chinese goods, ranging from electric vehicles to a vast iota of products, often at cheap prices that create unfair competition with local manufacturers.

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Alibaba's AliExpress hit with record 550 million-euro EU fine for counterfeit goods

EU fines AliExpress record €550 million for failing to tackle sales of illegal, unsafe and counterfeit products.

Jul 20, 2026
What's Going On
  • Alibaba's AliExpress was hit with a record €550 million ($629 million) fine from the European Union on Monday for failing to tackle sales of illegal, unsafe and counterfeit products on its platform.
  • The fine was the third issued by the European Commission under the EU's landmark Digital Services Act, which requires very large online platforms to do more to counter illegal and harmful content.
  • The Commission found that AliExpress failed to establish an effective system to detect and remove illegal products, while underestimating the gap between the number of human moderators available and the scale of their workload.
  • The mandatory "brand authorization system," intended to prevent the sale of counterfeits, was also deemed ineffective and understaffed by the Commission.
  • AliExpress must set an October 20 deadline for proposing remedial measures, and the company could face further penalties if the regulator decides in December that they do not comply with the DSA.
Objective Deep Dive

The EU's Digital Services Act, which entered force in 2022, represents an unprecedented regulatory framework for governing large online platforms across the bloc. The AliExpress decision reflects a broader shift in the EU's enforcement focus under the DSA, moving beyond social media platforms toward online marketplaces that facilitate the sale of physical goods. Early DSA cases largely centered on content and transparency issues on platforms such as X and Meta. The AliExpress and Temu cases involve products that regulators say may pose direct safety concerns for consumers. The Commission said AliExpress had not properly evaluated whether it had enough people to review the risks and had overestimated the effectiveness of its system in detecting and removing illegal products.

The question of how recommendation and advertising systems further exacerbate the distribution of illegal products was also insufficiently investigated. Tests by Commission departments showed that numerous illegal products were actively recommended to or advertised to consumers before being removed from the platform. AliExpress complained that the fine was "disproportionate" and "does not adequately reflect our established framework and the significant, proactive enhancements we have made." The company's position rests on claims of substantial investment in compliance, though the Commission's investigation found these investments insufficient in practice.

Temu's earlier deadline on Aug. 28 will provide the first indication of how the Commission evaluates post-fine compliance plans from marketplace platforms — and how much weight the Board's opinion carries when the two institutions disagree. Whether that process produces structural change or paper commitments is what the second half of 2026 will show. Europe's dealings with Beijing have been increasingly defined by a huge trade imbalance and tension over what Brussels says is overproduction by Chinese manufacturers benefitting from large industrial subsidies. EU leaders such as Ursula von der Leyen warned early this month that the bloc is weighing action to address its trade imbalances with Beijing. They say Europe is being flooded with cheap Chinese goods, ranging from electric vehicles to a vast iota of products, often at cheap prices that create unfair competition with local manufacturers.