AliExpress, Temu agree not to sell hazardous products

Chinese e-commerce firms pledge to ensure safety of Korean customers

The Fair Trade Commission (FTC) signed an agreement with AliExpress and Temu, Monday, to enhance monitoring the sale of potentially harmful products on the two Chinese e-commerce platforms.

The agreement comes in response to dozens of recent reports indicating that the two Chinese companies were selling unsafe goods to local consumers, including children’s products containing carcinogens or dangerous items that could cause injury or death.

The voluntary safety agreement is the first of its kind to be signed between a local authority and a foreign platform business operator. Notably, this is Temu’s first agreement of this type signed with a foreign government.

FTC Chairman Han Ki-jeong urged the two Chinese firms to take more responsibility in earning customers’ trust and ensuring their safety during a meeting with AliExpress Korea CEO Ray Zhang and WhaleCo Korea CEO Qin Sun, according to the nation’s top antitrust agency. WhaleCo Korea operates Temu’s local business.

“Our top priority is to generate tangible outcomes from the latest agreement, even if it is not legally binding,” Han told reporters during a press conference after signing the agreement. “We expect the agreement to create meaningful results, as was proven by ones signed between the Chinese firms and authorities in the European Union (EU) and Australia.”

Under the agreement, both parties agreed to enhance monitoring the sale of harmful or hazardous products on their respective platforms.

The FTC anticipates that this joint action will contribute to reducing the distribution and sale of harmful products on the two large e-commerce platforms, whose influence is rapidly expanding in Korea.

According to the watchdog, the number of AliExpress customers here reached 8.87 million as of March, coming in second following Coupang. Temu came in third with 8.29 million users.

“Foreign online platform firms should prioritize fulfilling their role in ensuring customer safety and building higher levels of trust with customers,” Han said.

The FTC chief urged all interested parties to make every effort to fulfill the agreement and establish a solid foundation for safe consumer activities in this region.

The Korean government also pledged to consult with foreign governments to enhance monitoring of the sale of potentially hazardous products by AliExpress and Temu and promptly notify the platforms of related cases so that appropriate action can be taken to block such sales.

AliExpress and Temu will also run their own monitoring systems and order vendors to stop selling hazardous products.

“We will immediately block the sale of any problematic items or products on our platform,” the head of AliExpress Korea said. “We run a customer service center employing 300 workers. If customers have any complaints, they can report the case to us and we will take necessary steps to resolve their complaints as promptly as possible.”

According to the FTC, the EU also reached a similar agreement with AliExpress and a group of 11 platform firms, such as Amazon and eBay, in 2018.

The Australian government also maintains such a partnership with Alibaba Group — the parent firm of AliExpress — and American e-commerce firms since 2020.

The latest decision was made in response to increasing customer distrust and concerns regarding Chinese e-commerce platforms.

The Korea Customs Office and the Seoul Metropolitan Government recently conducted safety inspections on children’s products sold on the two platforms and discovered harmful substances in some of them.

The discovery has prompted calls for the government and the watchdog to take immediate action to ensure the safety of customers, according to the FTC.