The European Commission has found that Chinese online shopping giant Shein, known for its low prices, is engaged in illegal commercial activities under EU law, following an investigation conducted jointly with national consumer protection authorities.
Investigators concluded that Shein lured customers with fake discounts by showing fake original prices or using countdown timers that continuously reset to create an artificial sense of urgency.
The Commission and the Consumer Protection Cooperation Network (CPC), a body made up of national authorities, also found serious transparency gaps: inaccurate return policies, misleading sustainability claims, and confusing product labeling. Authorities also criticized the platform for making it difficult for users to contact customer service, limiting their ability to ask questions or file complaints.
Shein was given one month to respond and explain how it plans to address these issues. If the Commission does not see progress, the company faces fines. National authorities in Belgium, France, Ireland, and the Netherlands oversee compliance with the legislation.
“All companies selling goods in the EU must play by our rules,” said Michael McGrath, Commissioner for Justice and Consumers. “Today’s action sends a clear message: we will not shy away from holding e-commerce platforms to account, no matter where they are based.” He added: “EU consumer protection laws are not optional – they must be applied in all cases.”
This is not the first time a Chinese platform has come under scrutiny. In November, rival e-retailer Temu was also found to be in violation of EU consumer protection laws. It used similarly problematic tactics and went even further by “gamifying” the shopping experience with promotions and fake product reviews.
In parallel to these consumer protection audits, both Shein and Temu are under investigation for possible violations of the Digital Services Act. The DSA inspection focuses on algorithmic recommendation systems – how certain products are promoted to specific users – and the sale of illegal goods, such as products that do not meet EU health and safety standards.
