Temu owner Whaleco takes European Union digital services fine to court

Whaleco Technology Ltd, the Dublin-registered applicant in the Temu case, has asked the General Court of the European Union to annul the European Commission’s decision of 28 May 2026 in Case DSA.100137 and to cancel the fines imposed on it. The action, brought on 12 August 2026 and registered as Case T-536/26, is published in the Official Journal of the European Union, C series, of 3 November 2026 under reference C/2026/5510.

The contested act is C(2026) 3646 final, adopted under Regulation (EU) 2022/2065 on a Single Market for Digital Services, which amended Directive 2000/31/EC. The Commission found a breach of Article 34 of that regulation — the identification and assessment of systemic risks by very large platforms — and imposed a fine of EUR 200 million. The applicant is established in Dublin, Ireland, the language of the case is English, and it is represented by F. González Díaz, A. Müller and J.-F. Keustermans.

In its form of order the company asks the Court to:

• annul the decision;
• in the alternative, annul in full or in part the fines imposed under Article 2 of the decision;
• order the European Commission to pay its own costs and those of the applicant.

A parallel action was lodged the same day by PDD Holdings Inc., of George Town, Cayman Islands, registered as Case T-535/26 and published in the same Official Journal issue as C/2026/5509, with the same three lawyers and a seven-ground challenge that largely mirrors the Temu action.

Access to the file and defence rights

The first plea alleges that the decision violates the applicant’s rights of defence, its right to a fair trial and the principle of good administration, because the Commission restricted access to the file on the basis of what the application calls an unlawful Article 5 of Commission Implementing Regulation (EU) 2023/1201, which lays down detailed arrangements for proceedings under the digital services rules. The application argues that the Commission assessed an incomplete and unreliable case file and failed to review third-party evidence objectively and diligently, and that these defects vitiate the decision in its entirety.

A further procedural plea challenges the standard of proof:

• the Commission allegedly reversed the burden of proof;
• it relied on anecdotal and uncorroborated third-party sources described as methodologically and statistically flawed to the point of being uninformative.

Parent company liability and the notion of provider

The second plea disputes the imputation of liability to PDD Holdings Inc. under Article 34(1) and (2) of Regulation (EU) 2022/2065, on the ground that the holding company was never the addressee of a designation decision under Article 33(4), presented in the application as a prerequisite for enforcing platform obligations against a specific entity.

The third plea argues that applying the notion of a “single economic unit” to widen the concept of “provider” breaches the principles of personal liability, legality, legal certainty and the presumption of innocence. Both actions also contest the calculation of the statutory maximum by reference to the group rather than to the platform operator itself.

The Article 34 methodology and the penalty

On substance, the applicant contends that the Commission retroactively imposed a specific assessment methodology with no basis in Article 34, converting a diligence obligation into an outcome-based requirement and a de facto general monitoring duty contrary to Articles 6 and 8 and to proportionality. It says shortcomings in the drafting of the 2024 risk assessment report were wrongly equated with an infringement, and it complains that the 2025 interim risk assessment report was dismissed without reasons.

The final plea attacks the penalty itself:

• the EUR 200 million fine is called unlawful and manifestly disproportionate;
• the novelty of the digital services regime is said to have warranted no fine or a purely symbolic one;
• the infringement was wrongly classified as “particularly serious”;
• the applicant’s cooperation was not properly taken into account, and deterrence was wrongly treated as requiring a penalty.

The outcome will shape how the Commission’s reading of systemic-risk duties survives judicial review, at a moment when the digital services rules are being tested for the first time against a large online marketplace rather than a platform designated years earlier. For traders and consumers on cross-border marketplaces, the ruling will determine how far parent companies can be held jointly answerable for a subsidiary’s compliance failures.

Source: Official Journal of the European Union, C series, No C/2026/5510, 3 November 2026, p. 1 (official reference: CELEX C/2026/5510).