The company fast fashion Shein has been brought under the scope of the European Union’s flagship rules designed to crack down on illegal and harmful content online.
Shein, which was founded in Chinabut now based in Singapore, averages more than 45 million monthly users in the EUso it meets the threshold to be targeted by the EU’s digital services law, the European Commission said on Friday.
“Shein will have to comply with them stricter rules under the DSA within four months of its notification,” the Commission said. This includes “the obligation to take specific measures to empower and protect online users, including minors, and to properly assess and mitigate any systemic risks arising from its services.”
This move means that Shein could be liable for fines of up to 6% of global revenue for violating the law, which is designed to curb the spread of illegal content online, according to Bloomberg.
Platforms already deployed under DSA include YouTube by Alphabet, Facebook by Meta Platforms and X by Elon Musk. Other markets, such as AliExpress by Alibaba Group Holding and its platform Amazon.com are also qualified, as they meet the criteria of having at least 45 million monthly active users in the EU.
THE Leonard Lin, Shein’s global head of public relations; said the company shares “the Commission’s ambition to ensure that consumers in the EU can shop online with peace of mind and we are determined to play our part”.
The DSA also requires online marketplaces to identify sellers on their platform, add methods for customers to flag illegal content and conduct random checks for illegal products.
The EU move is the latest attempt by regulators to crack down on companies with ties to China. Following the same rules earlier this week, the ByteDance’s TikTok was forced to halt a controversial rewards program in its Lite app before EU watchdogs carried out their threat to temporarily ban the feature over fears it could be addictive to children.
Under a separate legal instrument – the Foreign Subsidy Regulation – EU competition monitors carried out raid on the premises of the Chinese security company Nuctech, on suspicion that it may have received subsidies that could distort competition in the EU’s precious single market.
Other recent EU investigations under the Financial Instruments Subsidy Regulation have also targeted Chinese companies active in clean energy and railways. The flurry of investigations reflects the EU’s increasingly assertive approach to China, threatening restrictive trade measures that could lead to tariffs, cutting China off from European markets and potentially leading to a trade war.
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