European Union regulators announced Tuesday they are launching a formal investigation into Chinese online shopping giant Shein, examining whether the platform allows illegal product sales and uses potentially harmful addictive features in its app design.
The investigation stems from complaints raised by French officials in November, who called on EU leadership to take action against Shein for selling inappropriate child-like sex dolls through its platform. Since those concerns were raised, Shein has discontinued sales of all sex dolls across its global marketplace.
Both Shein and its competitor Temu have emerged as prominent examples of growing European concerns about the influx of inexpensive Chinese goods flooding the continent’s markets.
“The Digital Services Act keeps shoppers safe, protects their wellbeing and empowers them with information about the algorithms they are interacting with. We will assess whether Shein is respecting these rules and their responsibility,” stated EU technology commissioner Henna Virkkunen.
European officials had previously indicated last month that such an investigation was being considered.
In response to the announcement, Shein representatives said the company plans to maintain its cooperation with EU regulators and has made substantial investments in compliance measures related to the Digital Services Act, including conducting risk assessments and implementing protective measures for younger users.
“In addition to enhancement of detection tools, we also accelerated the rollout of additional safeguards around age-restricted products,” the company stated, noting they have introduced age-verification systems to prevent minors from accessing inappropriate content or products.
The European Commission indicated its investigation will examine Shein’s systems for preventing illegal product sales within EU markets, including materials that could constitute child sexual abuse content.
Investigators will also scrutinize what they describe as Shein’s addictive design elements, such as point systems and engagement rewards that may negatively affect user wellbeing.
The probe will additionally examine how transparent Shein’s recommendation algorithms are when suggesting content and products to users.
Shein’s rival Temu faced similar charges last year for allegedly violating the Digital Services Act by inadequately assessing risks associated with illegal products on its platform. EU officials expect to reach a final decision on Temu’s case sometime this year, while ongoing investigations continue into that platform’s addictive features and recommendation system transparency.
Companies found in violation of the Digital Services Act face potential fines reaching up to 6% of their worldwide annual revenue.
