Brussels has launched a formal probe into fast-fashion giant Shein over suspected breaches of the European Union’s digital platform rules, including allegations that illegal items were sold through its marketplace.
The European Commission confirmed that the Singapore-headquartered retailer is under investigation under the bloc’s Digital Services Act (DSA). The inquiry will examine concerns about the sale of unlawful products, the platform’s recommendation systems, and aspects of its design that regulators say may encourage addictive user behaviour.
According to the Commission, investigators will assess whether Shein has taken sufficient steps to prevent the distribution of illegal goods, including prohibited sexualised materials involving minors. EU officials stated that the investigation will be handled as a priority. Companies found to have violated the DSA can face fines of up to 6% of their global annual revenue.
Shein said it is cooperating with authorities and has been engaging with regulators in recent months. In a statement, the company said it has invested in strengthening its compliance with EU digital rules and will continue working with the Commission throughout the process.
Henna Virkkunen, Executive Vice-President of the European Commission, said EU laws banning illegal products apply equally to online marketplaces and physical stores, adding that digital platforms must meet the same standards of consumer protection.
The move forms part of broader enforcement efforts targeting major international e-commerce platforms operating in the EU. In July 2025, regulators concluded that Chinese online marketplace Temu had failed to adequately prevent the sale of illegal goods under the DSA framework.
Separately, the EU is accelerating plans to introduce new fees on small-value parcels shipped directly to consumers from outside the bloc, a measure aimed at addressing the surge in low-cost goods imported from China via online platforms such as Shein.
Shein has previously faced regulatory scrutiny in Europe. French authorities imposed a €40 million fine on the retailer in 2025 over allegations that it misled consumers regarding price reductions and environmental claims.
The company’s business model relies heavily on China-based suppliers, particularly in Guangzhou, and uses data-driven systems to identify trending designs. It produces items in very small initial batches and increases orders once demand is confirmed, allowing it to list millions of products at a time — significantly more than traditional mass-market retailers.
Western competitors have criticised Shein for benefiting from tariff exemptions on small parcels and international postal arrangements that help keep prices low. At the same time, regulatory and political scrutiny over labour standards and trade rules has complicated the company’s efforts to pursue a public listing.
Source: Financial Times reporting
