How China's biggest online shopping website Shein may face trouble in Europe

Chinese online shopping website Shein, a major fast-fashion retailer, is reportedly facing increased scrutiny from the European Union (EU) under its new regulations aimed at curbing harmful and illegal online content. This news comes from Bloomberg, citing sources familiar with the situation.

The EU's Digital Services Act (DSA), which came into effect in February 2024, applies to online platforms like Shein. The act requires large platforms and search engines to take stricter measures against illegal content and online safety risks. Several tech giants, including Amazon, Apple, Meta, and Alphabet, have already faced EU scrutiny under the DSA.

The EU has requested information from these companies regarding their practices in tackling illegal content and the sale of counterfeit goods online. Additionally, the EU is already investigating social media companies like X and ByteDance's TikTok.

Shein's IPO may lose its sheen
Shein, which is considering an initial public offering (IPO) in the United States, has not yet commented on the report. The European Commission has also not responded to requests for confirmation. This increased oversight from the EU could pose another challenge for Shein's potential IPO.

The company is already anticipating stricter regulatory scrutiny in the US market, on top of seeking approval from China for the public offering.