Vietnam’s government has stated that if Chinese online retailers Shein and Temu do not register their business with the Vietnamese Ministry of Industry and Trade by the end of November, they will be banned in Vietnam.
Shein and Temu, Chinese online platforms, have received global attention due to their sale of heavily discounted goods of poor quality.
According to Reuters, Vice Minister of the Ministry of Industry and Trade of Vietnam, Nguyen Huong Long, mentioned during a government meeting over the weekend that the ministry had been cooperating with Shein and Temu on licensing matters.
“After receiving notifications from the Ministry, if these platforms do not comply with requirements, the Ministry of Industry and Trade will coordinate with relevant authorities to implement technical measures such as blocking (Shein and Temu) applications and domain names,” Nguyen Huong Long stated in a government release after the meeting.
Shein has been selling products in Vietnam for some time, and Temu, under the Chinese e-commerce giant PDD Holdings, began allowing Vietnamese users to shop last month.
Previously reported by Vietnam’s “Dan Tri” newspaper, Trinh Xuan An, a representative of the Vietnam National Assembly and Executive Committee member of the National Assembly’s Committee on National Defence and Security, suggested taxing Temu immediately. Even goods priced as low as 200,000 to 500,000 Vietnamese dong (approximately 150 Chinese yuan) should be taxed. Relevant authorities must ensure product quality and sources to prevent consumers from purchasing counterfeit and substandard products, especially to avoid the market becoming a “dumping ground for cheap goods.”
Temu has engaged in price wars, sparking controversy in Indonesia previously. Several Indonesian officials believe this business model may threaten small and medium-sized enterprises in Indonesia. On October 11, Indonesian officials announced requesting Google and Apple to block the app of the Chinese fast-fashion e-commerce company Temu in their app stores, making the Temu app unavailable for download in the country.
Furthermore, these two companies have captured market share globally by selling inexpensive goods, taking market shares from competitors such as H&M, Zara, Target, Walmart, and Amazon, leading to regulatory measures from governments in the US and Europe.
On June 28, the European Commission issued formal information requests to online trading platforms Temu and Shein under the Digital Services Act, as these two Chinese companies designated as Very Large Online Platforms (VLOPs) by the EU, to provide more information on the measures they have taken to comply with the obligations of the DSA.
Chinese e-commerce companies like Shein and Temu have also been accused of exploiting the US “de minimis” policy, allowing a large number of low-cost goods to enter the US as “small parcels.” The White House announced on September 13th that measures would be taken to prevent the abuse of the “de minimis” policy.