SHEIN faces EU scrutiny over consumer law violations

The question

Why did the European Commission (Commission) conclude that SHEIN breached EU consumer law?

The key takeaway

Following a coordinated investigation at European level, SHEIN has been notified that certain of its platform practices infringe EU consumer law, with fake discounts, the use of pressure selling tactics, and unclear returns policies, being examples cited by the Commission. SHEIN had one month to respond with proposals to address the issues identified, or face enforcement action by national authorities across the EU – including fines based on annual turnover in the relevant Member State.

The background

On 26 May 2025, the Commission published the conclusions of the investigation it has coordinated with the Consumer Protection Cooperation (CPC) Network into SHEIN’s compliance with EU consumer law. The CPC comprises the national consumer authorities of all 27 EU Member States, Norway and Iceland, providing a network for coordinated action by the authorities (facilitated by the Commission).

This is not SHEIN's first brush with the European regulatory authorities. Last year, following its designation as a “very large online platform” (VLOP) under the Digital Services Act (DSA), SHEIN was issued with a request for information to check whether its platform was acting in accordance with its obligations under the DSA (you can read more about this in our Winter 2024 Snapshots article).

The development

The Commission and the CPC identified the following key violations of EU consumer law:

• fake discounts: displaying misleading price reductions that are not based on actual previous prices (i.e. pretending to offer better deals or exaggerating the value of discounts)
• pressure selling: using tactics (such as fake purchase deadlines) to create a false sense of urgency and to pressure consumers into completing their purchases quickly
• misleading information regarding returns: presenting incorrect or incomplete information to consumers regarding their legal rights to return goods and receive refunds and further failing to process the returns/refunds in accordance with those rights
• deceptive product labels: suggesting the product offers “special” features when the features are actually a legal requirement
• misleading sustainability claims: misleading consumers as to the sustainability features of products, and
• hidden contact details: making it difficult for consumers to contact SHEIN regarding enquiries and/or complaints.

The Commission has also requested additional information from SHEIN to assess compliance with obligations in respect of potentially misleading product rankings, reviews and ratings, as well as whether consumers are adequately informed on the contracts between SHEIN and third-party sellers (including how this affects their consumer rights).

Why is this important?

The Commission has stated in this investigation that it will not “shy away from holding e-commerce platforms to account, regardless of where they are based”. It foreshadows the Commission’s increased enforcement activities against retailers selling to the EU market and falling foul of EU legislation, in line with its wider efforts to enforce the DSA, safeguard consumer rights, and promote transparency in the digital marketplace.

Businesses, particular in the e-commerce sector, will face increasing pressure from regulators, who will utilise the harmonised and co-ordinated approach provided by the CPC to investigate and seek out wrongdoers. Further pressure is expected to come from consumers themselves – the EU consumer organisation, BEUC, recently filed a complaint against SHEIN over the use of “dark patterns” on its app and website, such as pop-ups stating that consumers will lose discounts if they leave the app and countdown clocks to encourage faster purchases.

Any practical tips?

Businesses must take a proactive approach to ensure that their websites and apps do not fall foul of EU consumer laws. This can be done, for example, by maintaining transparent pricing (including accurate information on discounts based on genuine previous prices), allowing consumers easy access to clear information on their rights to returns and refunds, and avoiding the use of tactics that may be considered “aggressive commercial practices” by the EU. The Commission’s continued investigation of SHEIN should be monitored closely, including any commitments made by SHEIN which will help shape internal compliance strategy and framework.