The European Commission has slapped a record €550 million ($628.37 million) fine on Chinese e-commerce giant AliExpress, a subsidiary of Alibaba Group Holding Limited (NYSE: BABA), for failing to prevent the sale of illegal and harmful products.
The Commission issued the unprecedented fine to AliExpress for its inability to halt the sale of unlawful and dangerous goods. The EU's tech chief, Henna Virkkunen, underscored the presence of counterfeit items, unsafe toys, and hazardous cosmetics on the platform, which continued to be advertised despite failing to meet standards.
This penalty is the largest ever imposed by the EU under the Digital Services Act (DSA), which requires large platforms like AliExpress to assess and mitigate the risks of spreading illegal content and goods. The EU stated that AliExpress's failure to manage these risks is not only dangerous for consumers but also unfair to companies that comply with all rules.
The EU also discovered that AliExpress did not evaluate whether it had enough manpower to review potentially illegal products, resulting in overworked moderators with limited time to review products. The company also neglected to assess how its advertising systems could amplify the spread of illegal products and relied on compliance checks that could be easily circumvented.
Alibaba did not immediately respond to Benzinga's request for comments.
AliExpress Joins Temu In EU Fines
The European Commission launched an investigation into AliExpress in March 2024 over suspected violations of the DSA, with several issues resolved through commitments made in June 2025. The latest penalty is the third fine issued under the DSA and comes two months after rival Temu was fined €200 million ($228.50 million) for similar violations. EU officials said the size of AliExpress' fine reflected the duration and seriousness of the breaches.
Despite the fine, Alibaba's stock gained on Monday, as the company announced the availability of Qwen3.8 Max-Preview, the strongest model in its Qwen family, through its Token Plan subscription service and its Qoder and QoderWork agentic platforms. However, the impact of the fine on Alibaba's future performance remains to be seen.
EU Tightens Big Tech Crackdown
This development follows a series of actions by the EU to enforce the Digital Services Act. Earlier this month, the EU accused Meta Platforms Inc. (NASDAQ: META) of violating its digital laws due to the 'addictive' designs of its Instagram and Facebook platforms.
The EU also upheld a record $4.7 billion Android antitrust fine against Alphabet Inc.'s (NASDAQ: GOOGL) (NASDAQ: GOOG) Google earlier this month. The Court of Justice upheld Google's appeal against an antitrust ruling, confirming the revised fine over the company's anti-competitive practices related to the Android operating system.