The European Commission announced on Wednesday (February 7th) that the Chinese online market platform Temu and fast fashion retailer Shein will be held accountable for the unsafe and dangerous products they sell on their platforms. The EU is taking measures to combat the influx of a large number of cheap e-commerce imported products.
Furthermore, the European Commission stated that it will coordinate with national consumer protection authorities under the Consumer Protection Cooperation Network (CPC) to launch a joint investigation into Shein for allegedly violating EU consumer protection regulations.
This marks the second blow faced by these two fast fashion companies. Earlier this week, the United States terminated a trade provision, preventing retailers like Temu and Shein from shipping duty-free low-cost packages to the US under the “de minimis” threshold, aimed at combating illicit substances like fentanyl entering the country via small packages.
The European Commission revealed that around 46 million items of cheap goods valued at less than 22 euros (approximately $23) were imported into the EU last year, equivalent to 12 million parcels per day, with 91% originating from China. This figure has doubled since 2023, raising concerns within the EU.
“In certain circumstances, e-commerce platforms may also be held responsible for the sale of non-compliant or dangerous products,” the European Commission stated in its guidelines, noting that they may be exempt from liability for sellers’ illegal activities under specific conditions.
The EU emphasized that these cheap imported goods posing safety hazards create unfair competition for compliant EU sellers and have negative impacts on the environment and climate due to the large influx of parcels.
To address this issue, the European Commission will recommend to member states to impose processing fees on e-commerce imported goods to cover the costs of regulating such imports.
In 2023, the EU proposed abolishing duty-free treatment for parcels below 150 euros as part of customs reform. The European Commission urged member states to adopt this measure promptly.
Moreover, the EU introduced a new measure called the “Product Safety Sweep,” allowing member states for the first time to assess whether products are hazardous through electronic monitoring tools before transportation.
European Commissioner for Digital Affairs, Henna Virkkunen, stated in a release, “We want to see a fair competitive e-commerce market that ensures consumer safety, offers convenient products, and respects the environment.”
According to Semafor’s report on Tuesday (February 6th), the US government is discussing whether to include Shein and Temu in the Department of Homeland Security’s (DHS) list of entities associated with forced labor.
The report, citing two informed sources, mentioned that the US government has not made a final decision yet.
Both companies have denied involvement in forced labor. In an email statement to Reuters, Shein said, “We are unaware of any such considerations. The company fully complies with the US Uyghur Forced Labor Prevention Act (UFLPA).”
Temu also stated in an email, “Temu strictly prohibits the use of forced labor and enforces our Third-Party Code of Conduct, which explicitly forbids all forms of involuntary labor.”