France Pushes EU for Stricter E-commerce Enforcement Against Non-Compliant Retailers

France’s Minister for Trade and SMEs, Véronique Louwagie, has escalated her call for a robust European enforcement protocol, formally requesting the European Commission implement measures to delist e-commerce sites that violate EU regulations. This follows her initial public appeal in July, underscoring a growing concern within the European Union regarding the operations of certain online retailers.

In a formal letter addressed to Michael McGrath, the EU Commissioner for Justice, Louwagie articulated the urgent necessity for amendments to existing EU laws. These changes would empower Brussels to take decisive action against e-tailers found to be in breach of European regulations. She emphasized that such a solution is both “necessary” and “urgent,” citing the “growing threat to European business interests and the safety of European consumers” posed by these non-compliant platforms.

Louwagie's request comes amidst a broader European scrutiny of major online marketplaces. In her letter, she commended the ongoing Europe-wide investigations targeting prominent Asian e-tailers like Temu and AliExpress, which are known for offering a vast array of products at exceptionally low prices. Additionally, she acknowledged the charges that have been brought against the ultra-low-cost fashion giant, Shein, highlighting a coordinated effort to address concerns across the continent.

The aforementioned e-tailers have faced a barrage of accusations, ranging from the sale of counterfeit and potentially dangerous goods to practices that infringe upon consumer rights. These alleged violations include the application of misleading discounts and the provision of inaccurate product information, creating a significant challenge to fair trade and consumer protection within the EU.

France has already taken unilateral steps against these practices. In early July, Chinese budget apparel e-tailer Shein was sanctioned by France for "misleading commercial practices" and subsequently fined €40 million. This action followed a statement in March by France’s Trade Commission, which had expressed its intention to ban ultra-low-cost e-tailers like Shein and Temu from operating within French borders. A notable precedent exists from late 2021, when the US budget e-tailer Wish was delisted in France, effectively making it unsearchable on major search engines unless its full URL was entered.

However, applying a similar delisting measure to giants like Shein and Temu presents unique challenges. Representatives from the French e-commerce federation Fevad and retail association Alliance du Commerce highlighted this complexity in spring, stating that “The situation is by no means the same” as with Wish. Yohann Petiot, managing director of Alliance du Commerce, pointed out that “Wish had failed to respond to the authorities.” In contrast, Temu and Shein have engaged in vigorous lobbying efforts, asserting their respect for public authorities and actively promoting the perceived positives of their business models.

Consequently, Minister Louwagie’s formal request is specifically aimed at establishing an entirely new, Europe-wide enforcement protocol designed to effectively combat non-compliant Chinese e-tailers. Currently, the primary EU-level measure targeting ultra-low-cost e-tailers has been the abolition of the tax exemption on non-European parcels valued under €150. Yet, the full implementation of this measure faces delays, potentially not coming into effect until 2028, if not sooner.

In the interim, Shein and Temu have significantly solidified their market presence, cementing their positions among the top 20 most-visited e-tailers in France. A Fevad survey for Q2 revealed Temu as the third most-visited site, attracting an impressive 22.5 million monthly unique users and 3.9 million daily unique users. Shein also ranked highly, securing the eighth spot with 16.7 million monthly unique users and 4.4 million daily unique users, underscoring the urgency of establishing comprehensive regulatory frameworks.