12:50 PM EDT, 10/30/2024 (MT Newswires) -- PDD Holdings' ( PDD ) e-commerce unit Temu will likely undergo a European Union probe over its alleged failure to prevent illegal online sales under Digital Services Act, Bloomberg News reported Wednesday.

This investigation could be announced soon, though the timeline might be affected by upcoming changes in EU leadership, the media outlet reported, citing sources with knowledge of the matter. Temu may also be able to avoid penalties if it proposes adequate countermeasures to address the concerns.

Temu's initial response was deemed insufficient following an EU request on Oct. 11 for the company to provide detailed data on how it handles counterfeit or unsafe items on its site, according to the media outlet.

The European Union declined MT Newswires request for comment. PDD Holdings ( PDD ) did not immediately respond.

The company's shares were down more than 3% in recent trading.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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