Temu, a Chinese e-commerce platform, is facing serious accusations in Pakistan. The Chainstore Association of Pakistan (CAP) has filed a formal complaint with the Competition Commission of Pakistan (CCP). The complaint highlights concerns about Temu’s market behavior, including tax evasion, predatory pricing, and unfair competition.
Temu recently entered the Pakistani market with a strong digital marketing campaign. It flooded social media platforms with promotional content offering heavy discounts. These offers quickly attracted buyers but created problems for local sellers. Small retailers and e-commerce businesses were unable to match Temu’s low prices and massive scale.
CAP claims that Temu, along with similar platforms like Shein, operates without any legal or physical presence in Pakistan. These companies ship products under the de minimis exemption, which allows small packages to enter the country without customs duties. As a result, Temu avoids taxes and import duties that local sellers are required to pay. This creates an unfair advantage and poses a threat to the survival of legitimate businesses.
The complaint also mentions that Temu encourages customers to prepay in foreign currency. There is no option for cash on delivery. CAP believes this practice could negatively affect Pakistan’s current account balance.
Furthermore, industry insiders claim that Temu breaks down large orders into smaller parcels to stay below tax limits. It also under-declares product values and mislabels shipments to avoid customs duties. These practices are illegal and harm the formal retail sector, importers, and manufacturers who comply with local laws.
CAP has urged the CCP to begin a detailed investigation. It also recommends collaborating with the Ministry of Commerce, the FBR, and the SECP to implement more effective checks. Suggestions include utilizing digital tracking systems and ensuring that valid invoices and accurate retail values accompany all shipments.
In addition, a separate complaint was filed with the Office of Fair Trade in Islamabad by independent sellers. They claim Temu’s pricing strategy is misleading consumers and harming fair competition.
Despite increasing concerns, enforcement remains weak. Local businesses face strict rules while Temu continues to operate freely. CAP has offered full support to the CCP in addressing this issue and protecting Pakistan’s business environment.
