Temu's 'warehouse' expansion in SA will be monitored, says Trade Minister

Chinese-owned e-commerce platform Temu announced in July that it would be using a local warehouse dispatch service to deliver its goods here.

Products eligible for this service are labelled 'local warehouse' and are transported directly from within South Africa.

Now, government has indicated that this development would be monitored closely.

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Minister Parks Tau said the Department of Trade, Industry and Competition (DTIC) had noted media reports that Temu has launched its 'local warehouse' and the National Consumer Commission (NCC) shall be monitoring these developments and their impact on the domestic retail sector.

He made the statement in response to a parliamentary question from the EFF.

Just like any other company selling goods into the South African market directly to consumers, Temu would have to adopt advertising and marketing strategies that comply with the laws of the country, Parks said.

While no formal complaints have been initiated or received against Temu, the NCC has noted concerns raised in other jurisdictions around issues of deceptive practices, quality and safety of products, he said.

After gathering data, the Commission is to determine if there is a reasonable suspicion to proactively initiate an investigation.

At present they are busy formulating the scoping and direction they want to take, says NCC spokesperson Phetho Ntaba.

"Once we have established if there are contraventions or where there are contraventions of the Consumer Protection Act (CPA), that is where we are going to investigate."

When Stephen Grootens questions what the point of this is if the CC has not actually received any formal complaints, Ntaba points out that the law allows them to initiate an investigation even in the absence of consumer complaints.

People do complain via other channels like social media platforms, she says, and where they see a trend and have satisfied themselves that there are possibilities of contraventions of the law involved, that is where they initiate an investigation.

"What we are doing, is looking at e-commerce holistically... At the end of the day, we want to ensure that South African consumers are protected."

To listen to Phetho Ntaba in conversation with Stephen Grootes on 702's The Money Show, click on the audio link below: