With the drastic growth of online shopping, dropshipping has evolved as a major form of distribution. "Buy here, get from there", simplistically. The growth of dropshipping has turned into a major headache for authorities, as it has proven, unfortunately, to be a field day for rogue producers.
A Headache for Authorities
The sheer volume of packages arriving from far away makes it extremely hard, if at all possible, for authorities to uphold regulations of all kinds:
Health and safety standards and regulations
Customs and VAT regulations
Immaterial property rights
The combination of the volume of packages and the sender of packages being located i a different jurisdiction makes it difficult both to discover irregularities as well as taking legal action against rogue producers.
A full-blown Wild West, in other words.
8 of 10 Toys Failed to Meet Safety Standards
Mid October 2024, Toy Industries of Europe (TIE) reported disturbing test results. They had ordered over 100 toys from third-party traders from both within and outside the EU. The toys, which were both unbranded or unknown brands, were bought on 10 online marketplaces.
Subsequent independent laboratory tests show that 80% of the toys failed to meet EU safety standards. The hazards they posed where, among others:
Choking from small parts as a result of breakage
Magnets that could perforate a child's intestines of two are swallowed
Accessible button batteries that can cause injury or death if ingested
Slime products containing boron over 13 times the legal limit, a substance linked to reproductive health issues
The findings were especially worrying as six of the ten online marketplaces obviously failed to live up to having signed the EU Product Safety Pledge, a voluntary commitment to prevent sales of unsafe products on their platforms.
The full list of the ten platforms is: Allegro(9/9), AliExpress (14/10), Amazon Marketplace (20/15), Bol (5/2), Cdiscount (5/5), Fruugo (4/4), Light In The Box (5/3), Shein (10/10), Temu (25/19), and Wish (5/5). In brackets: Number of toys assessed
bought from the platform/Number that failed the tests.
TIE state: "It thousands of toymakers across the EU, 99% of which are SMEs, can take responsibility for the safety of their products, then so should online marketplaces."
Proven Disrespect of Safety Standards – How About Immaterial Property Rights?
Do you believe that adherence to immaterial property rights by dropshippers is much better than their adherence to safety standards? We sincerely doubt it. We aren't aware of any similar study having been made regarding counterfeiting of branded products, but it would sure be interesting to do one. Maybe an idea for EUIPO to take action upon? Maybe including sales via ads on social media platforms, as we covered in "Who's an Accomplice to a Crime, Really?" some time ago.
As long as the volumes of dropshipped products overwhelm authorities and local responsibility is lacking, we doubt that we will see any improvements. In the meantime, let's hope that the use of reliable product authentication grows and the public becomes more aware about the risks of buying through dropshipping.
Image by ELENA BESSONOVA on iStock