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The European Commission has found that Chinese online retail giant Shein, known for its rock-bottom prices, engages in illegal commercial practices under EU law, after an investigation caried out with national consumer protection authorities.
Investigators concluded that Shein lures customers with fake discounts, either by displaying false original prices or by using countdown timers that reset continuously to foster an artificial sense of urgency.
The Commission and the Consumer Protection Cooperation (CPC) Network – a body made up of the national authorities – also flagged serious gaps in transparency: inaccurate return policies, misleading sustainability claims, and confusing product labelling. Authorities also criticised the platform for making it difficult for users to contact customer service – limiting their ability to raise questions or complaints.
Shein has been given one month to respond and outline how it plans to fix the issues. If the Commission sees no progress, the company could face fines. National authorities from Belgium, France, Ireland and the Netherlands are overseeing enforcement.
“All companies selling products in the EU must play by our rules,” said Michael McGrath, Commissioner for Justice and Consumer Protection. “Today’s action sends a clear message: we will not shy away from holding e-commerce platforms to account, regardless of where they are based.” He added: “EU consumer protection laws are not optional – they must be applied in all cases.”
This isn’t the first time a Chinese platform has come under scrutiny. In November, rival e-retailer Temu was also found in breach of EU consumer law. It used similarly problematic tactics and went a step further by “gamifying” the shopping experience with spin-the-wheel promotions and displaying fake product reviews.
Alongside these consumer law probes, both Shein and Temu are under investigation for possible breaches of the Digital Services Act. The DSA probe focuses on algorithmic recommendation systems – how certain products are promoted to specific users – and the sale of illegal goods, such as items that fail to meet EU health and safety standards.
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