The European Commission has slapped AliExpress with a €550 million ($629 million) fine for repeatedly failing to curb the sale of illegal, unsafe, and counterfeit products on its platform. The penalty, announced on Monday, is the largest ever issued under the EU's Digital Services Act (DSA) and signals that Brussels is done warning Chinese e-commerce giants and ready to hit them where it hurts: their balance sheets.
The investigation found systemic failures in AliExpress's content moderation systems, inadequate enforcement against repeat offenders, and a chronic underestimation of the risks posed by illegal goods reaching European consumers. The platform, owned by Alibaba Group, has more than 104 million monthly active users in the EU, making it one of the biggest online marketplaces subject to the bloc's strictest digital rules.
What the Commission Found
The formal probe began in March 2024 after regulators identified a pattern of dangerous products circulating unchecked. The Commission's final decision confirms what preliminary findings suggested last year: AliExpress violated Articles 34 and 35 of the DSA, which require Very Large Online Platforms to proactively assess and mitigate systemic risks.
Specifically, investigators found that AliExpress's moderation systems suffered from "systemic failures" that allowed malicious traders to manipulate listings. The platform also failed to enforce any meaningful penalty policy against sellers who repeatedly posted illegal content. Even the company's own risk assessments downplayed the scale of the problem, according to the Commission's findings.
The illegal products in question were not minor infractions. They included counterfeit medicines, non-compliant food supplements, unsafe cosmetics, and adult material accessible to minors. Some sellers used "hidden links" and affiliate programmes to disguise banned goods, tactics that AliExpress's detection systems missed repeatedly.
A History of Non-Compliance
This fine is not a sudden ambush. The Commission sent AliExpress a formal request for information in November 2023, giving the platform ample opportunity to demonstrate compliance before proceedings opened. In June 2025, regulators issued preliminary findings and accepted a set of legally binding commitments from AliExpress aimed at tightening detection, improving seller verification, and limiting the visibility of adult products.
Those commitments clearly were not enough. By March 2026, European Parliament lawmakers were still confronting AliExpress executives with data showing that over half of products linked to the platform failed to meet EU safety standards. In some categories, non-compliance rates reached 81 percent in laboratory testing. MEP Christel Schaldemose, the DSA's lead rapporteur, put it bluntly during one hearing: "I will not be happy and I don't believe in your systems until the day I see it has an impact."
Why This Fine Matters Beyond AliExpress
The €550 million penalty sets a new benchmark for DSA enforcement and sends a clear message to other Chinese e-commerce platforms operating in Europe. Temu and Shein, which have exploded in popularity across the EU, are watching closely. Both platforms have faced similar scrutiny over product safety and traceability, and regulators have already signalled that no marketplace is too big to fine.
The timing is also significant. Starting 1 July 2026, the EU is removing the customs duty exemption for parcels valued below €150, a change that will directly impact AliExpress's low-cost shipping model. The combination of heavier tariffs and stricter enforcement creates a regulatory environment where cutting corners on compliance is no longer economically viable.
For European consumers, the fine is a long-overdue acknowledgment of a problem that has plagued cross-border e-commerce for years. For AliExpress, it is a costly reminder that operating in the world's second-largest economy requires more than cheap prices and fast shipping. It requires trust, and trust, as Brussels has just demonstrated, has a price tag.
AliExpress now faces the choice of overhauling its compliance infrastructure or risking even steeper penalties. The DSA allows fines of up to 6 percent of global annual turnover, a figure that would dwarf Monday's penalty. Whether Alibaba's leadership treats this as a wake-up call or merely the cost of doing business will determine the platform's future in Europe.