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LONDON — The European Union is investigating Chinese online retailer Temu over suspicions it’s failing to prevent the sale of illegal products, the 27-nation bloc’s executive arm said on Thursday.

The European Commission opened its investigation five months after adding Temu to the list of “very large online platforms” needing the strictest level of scrutiny under the bloc’s Digital Services Act. It’s a wide-ranging rulebook designed to clean up online platforms and keep internet users safe, with the threat of hefty fines.

Temu started entering Western markets only in the past two years and has grown in popularity by offering cheap goods — from clothing to home products — that are shipped from sellers in China. The company, owned by Pinduoduo Incorporated, a popular e-commerce site in China, now has 92 million users in the EU.

Temu said it “takes its obligations under the DSA seriously, continuously investing to strengthen our compliance system and safeguard consumer interests on our platform.”

“We will cooperate fully with regulators to support our shared goal of a safe, trusted marketplace for consumers,” the company said in a statement.

European Commission Executive Vice President Margrethe Vestager said in a press release that Brussels wants to make sure products sold on Temu’s platform “meet EU standards and do not harm consumers.”

EU enforcement will “guarantee a level playing field and that every platform, including Temu, fully respects the laws that keep our European market safe and fair for all,” she said.

The commission’s investigation will look into whether Temu’s systems are doing enough to crack down on “rogue traders” selling “noncompliant goods” amid concerns that they are able to swiftly reappear after being suspended. The commission didn’t single out specific illegal products that were being sold on the platform.

Regulators are also examining the risks from Temu’s “addictive design,” including “game-like” reward programs, and what the company is doing to mitigate those risks.

Also under investigation is Temu’s compliance with two other DSA requirements: giving researchers access to data and transparency on recommender systems. Companies must detail how they recommend content and products and give users at least one option to see recommendations that are not based on their personal profile and preferences.

Temu now has the chance to respond to the commission, which can decide to impose a fine or drop the case if the company makes changes or can prove that the suspicions aren’t valid.

Brussels has been cracking down on tech companies since the DSA took effect last year. It has also opened an investigation into another e-commerce platform, AliExpress, as well as social media sites such as X and Tiktok, which bowed to pressure after the commission demanded answers about a new rewards feature.

Temu has also faced scrutiny in the United States, where a congressional report last year accused the company of failing to prevent goods made by forced labor from being sold on its platform.
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The crowd-sourced fact-checking feature of Elon Musk’s X, Community Notes, is “failing to counter false” claims about the U.S. election, the Center for Countering Digital Hate (CCDH) said in a report Wednesday.

Out of the 283 misleading posts that CCDH has analyzed on the digital social media platform, 209 or 74% of the posts did not show accurate notes to all X users correcting false and misleading claims about the elections, the report said.

“The 209 misleading posts in our sample that did not display available Community Notes to all users have amassed 2.2 billion views,” CCDH said, urging the company to invest in safety and transparency.

X did not immediately respond to a Reuters request for comment.

X launched its “Community Notes” feature last year, which allows users to comment on posts to flag false or misleading content, in effect crowd-sourcing fact checking to users rather than a dedicated team of fact checkers.

The report comes after X lost a lawsuit brought by CCDH earlier this year that faulted it for allowing a rise in hate speech on the social media platform.

Social media platforms, including X, have been under scrutiny for years over the spread of misinformation and conspiracy theories, including false information about elections and vaccines.

Secretaries of state from five U.S. states urged billionaire Musk in August to fix X’s AI chatbot, saying it had spread misinformation related to the November 5 election.

Musk, who endorsed Republican presidential candidate Donald Trump in July, himself has been accused of spreading misinformation. Polls show Trump is in a tight race with Democratic Vice President Kamala Harris.
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JIUQUAN, China — China declared a “complete success” after it launched a new three-person crew to its orbiting space station early Wednesday as the country seeks to expand its exploration of outer space with missions to the moon and beyond.

The Shenzhou-19 spaceship carrying the trio blasted off from the Jiuquan Satellite Launch Center in northwest China at 4:27 a.m. local time atop a Long March-2F rocket, the backbone of China’s crewed space missions.

“The crew condition is good and the launch has been successful,” the state broadcaster China Central Television announced.

China built its own space station after being excluded from the International Space Station, mainly because of U.S. concerns over the People’s Liberation Army, the Chinese Communist Party’s military arm’s overall control over the space program. China’s moon program is part of a growing rivalry with the U.S. and others, including Japan and India.

The team of two men and one woman will replace the astronauts who have lived on the Tiangong space station for the last six months. They are expected to stay until April or May of next year.

The new mission commander, Cai Xuzhe, went to space in the Shenzhou-14 mission in 2022, while the other two, Song Lingdong and Wang Haoze, are first-time space travelers, born in the 1990s.

Song was an air force pilot and Wang an engineer with the China Aerospace Science and Technology Corporation. Wang will be the crew’s payload specialist and the third Chinese woman aboard a crewed mission.

Besides putting a space station into orbit, the Chinese space agency has landed an explorer on Mars. It aims to put a person on the moon before 2030, which would make China the second nation after the United States to do so. It also plans to build a research station on the moon and has already transferred rock and soil samples from the little-explored far side of the moon in a global first.

The U.S. still leads in space exploration and plans to land astronauts on the moon for the first time in more than 50 years, though NASA pushed the target date back to 2026 earlier this year.

The new crew will perform spacewalks and install new equipment to protect the station from space debris, some of which was created by China.

According to NASA, large pieces of debris have been created by “satellite explosions and collisions.” China’s firing of a rocket to destroy a redundant weather satellite in 2007 and the “accidental collision of American and Russian communications satellites in 2009 greatly increased the amount of large debris in orbit,” it said.

China’s space authorities say they have measures in place in case their astronauts have to return to Earth earlier.

China launched its first crewed mission in 2003, becoming only the third nation to do so after the former Soviet Union and the United States. The space program is a source of enormous national pride and a hallmark of China’s technological advances over the past two decades.
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The Treasury Department on Monday finalized a new rule meant to prevent U.S.-based people and companies from investing in the development of a range of advanced technologies in China, thereby preventing Beijing from accessing cutting-edge expertise and equipment.

The rule, which implements an executive order signed by President Joe Biden in 2023, focuses particularly on advanced semiconductors and microelectronics and the equipment used to make them, technology used in quantum computing, and artificial intelligence systems.

When it takes effect on January 2, the rule will prohibit certain transactions in semiconductors, microelectronics and artificial intelligence. It also establishes mandatory reporting requirements for transactions that are not banned outright.

In the field of quantum computing, the rule is more far-reaching, banning all transactions “related to the development of quantum computers or production of any critical components required to produce a quantum computer,” as well as the development of other quantum systems. Unlike the fields of AI and semiconductors, the rule does not allow for transactions that can be completed so long as they are reported to the government.

The rule also announced the creation of the Office of Global Transactions within Treasury’s Office of Investment Security, which will administer the Outbound Investment Security Program.

Justification and opposition

“Artificial intelligence, semiconductors, and quantum technologies are fundamental to the development of the next generation of military, surveillance, intelligence and certain cybersecurity applications like cutting-edge code-breaking computer systems or next generation fighter jets,” Paul Rosen, assistant secretary for investment security, said in a statement.

“This Final Rule takes targeted and concrete measures to ensure that U.S. investment is not exploited to advance the development of key technologies by those who may use them to threaten our national security,” Rosen said.

Beijing has repeatedly complained about U.S. technology policy, arguing that the U.S. is dedicated to preventing China’s rise as a global power. In a press conference on Tuesday, Chinese Foreign Ministry spokesperson Lin Jian reiterated China’s longstanding objections to U.S. efforts to withhold advanced technology from Chinese companies.

“China deplores and rejects the U.S.’s Final Rule to curb investment in China,” Lin said. “China has protested to the U.S. and will take all measures necessary to firmly defend its lawful rights and interests.”

Not just equipment

The language of the rule frequently notes that it applies to transactions with “countries of concern,” but the specific language in the text makes it plain that the targets of the rule are companies and individuals doing business in mainland China as well as the “special administrative districts” of Hong Kong and Macao.

The Final Rule’s ban on transactions is not limited to the physical transfer of finished goods and machinery in the specified fields. Explanatory documents released on Monday make it clear that several intangible benefits are also covered.

Countries of concern “are exploiting or have the ability to exploit certain United States outbound investments, including certain intangible benefits that often accompany United States investments and that help companies succeed,” an informational statement accompanying the rule said. “These intangible benefits include enhanced standing and prominence, managerial assistance, investment and talent networks, market access, and enhanced access to additional financing.”

Signaling to US companies

The onus will be on U.S. companies to comply with the new rule, Stephen Ezell, vice president for global innovation policy at the Information Technology & Innovation Foundation, told VOA.

“This is the U.S. government signaling to U.S. entities and investors that they need to think twice about making investments on the prohibited transaction side of the equation that would advance China’s capabilities in these areas,” Ezell said.

He added that the impact of the rule on investment in Chinese technology companies would have effects far beyond any reduction in funding.

“It’s not just the dollars,” he said. “A key target here is getting at the intangible benefits that come with those investments, such as managerial capability, talent networks.” He described that loss as “very significant.”

Closing loopholes

In an email exchange with VOA, Daniel Gonzales, a senior scientist at the RAND Corporation, explained that the purpose of the rule was, in part, to prevent U.S. investment firms from supporting Chinese firms in the development of certain kinds of technology.

“These rules were put in place after many episodes where U.S. [venture capital] companies helped to transfer or nurture advanced technologies that have relevant military capabilities,” Gonzales wrote. “One particular case was that of TikTok and its AI algorithms, which were developed with the help of Sequoia Capital of California.”

Sequoia did not break any laws in assisting TikTok, Gonzales said. But “it has since become known to U.S. authorities that TikTok does possess an AI algorithm that has a variety of applications, some of which have military implications. This new rule is intended to close this loophole.”

Gonzales said the U.S. government’s concern with quantum computing is also born of worries about Chinese offensive capabilities.

“Chinese researchers are working on developing quantum computer algorithms that can break encryption codes used by the U.S. government and the U.S. financial sector to protect private and confidential information,” he wrote. “China has several startup companies working to develop more powerful quantum computers. This new rule is intended to prevent the leakage of U.S. quantum technology to China through U.S. VCs.”
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