European regulators have signalled that Shein, the China-based fast-fashion online retailer, could be subject to a formal EU investigation over the presence of illegal products on its platform, but that an immediate suspension of the site is unlikely, a senior European Commission official said on Tuesday.
The Commission moved Shein into its crosshairs after reports last November of sales in France involving childlike sex dolls and other items deemed illegal. Those incidents prompted the regulator to warn of a potential systemic consumer safety risk posed by the platform across the 27-country bloc.
Using enforcement powers under the Digital Services Act, which sets out stricter obligations for large online intermediaries to tackle illegal and harmful content, the Commission has asked Shein to supply details and documents describing measures the company has implemented to counter the problem.
Rita Wezenbeek, the Commission official responsible for DSA enforcement, told a European Parliament hearing on Shein that EU tech chief Henna Virkkunen had urged rapid action. "We have been urged by Mrs Virkkunen to act very swiftly," she said.
Wezenbeek referenced previous actions against other large marketplaces to underscore the approach the Commission is prepared to take. She noted a one-year probe into Alibaba’s AliExpress that concluded last year with the company committing to greater transparency around its advertising and recommendation systems. She also recalled that charges were brought against Chinese rival Temu in July last year.
"We want to apply the same speed with respect to Shein. So this may mean that we have to open an investigation. We have loudly received the call today to do that, but it will in the end be a decision by Mrs Virkkunen whether we do so," Wezenbeek said.
Shein’s general counsel for Europe, Middle East and Africa, Yinan Zhu, told EU lawmakers on Tuesday that the company has removed illegal listings and implemented measures to take down unlawful products. Zhu argued that such challenges affect multiple marketplaces and that bad actors repeatedly seek ways to evade platform controls.
Despite vocal calls from some EU lawmakers for immediate action, Wezenbeek indicated that regulators are unlikely to issue an interim measure or order a ban against Shein. She cited a Paris court ruling last month that rejected the French government’s plea to suspend Shein over the sex doll sales.
The Paris court concluded that a ban would be "even manifestly disproportional because of the measures Shein took, because of the fact that there were only certain products found... and also that the French state provided no evidence of systemic non-compliance," Wezenbeek said.
Under the DSA, companies found in breach can face fines of up to 6% of their total global revenues. The Commission has requested further documentation from Shein as it considers whether to open a formal investigation, and any decision to proceed will rest with the EU tech commissioner.
Summary
The European Commission has asked Shein for documentation on steps taken to remove illegal products from its marketplace and has signalled that a formal investigation under the Digital Services Act is possible. However, officials indicated an interim suspension of the site is unlikely, referencing a recent Paris court ruling and precedents from probes into other large platforms.