The European Union has included Chinese online clothing retailer Shein among major internet platforms subject to stricter controls under the EU’s Digital Services Regulation. The reason is the high number of users who shop in the company’s e-shop. “There is a suspicion that the Shein company sells goods that are so cheap that they cannot be manufactured in accordance with the conditions of work safety,” Rebeka Hengalová from the Europeum Institute tells Plus.
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Prague
14:58 April 27, 2024
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The Shein company has until the end of August to implement more significant strategies to protect its consumers, points out Rebeka Hengalová (illustrative photo) | Source: Unsplash | CC0 1.0
Am I understanding correctly that this Chinese clothing retailer ranks alongside companies like the X network, TikTok or Facebook and Google because of how many users it has?
That’s right, you got it right. This European regulation on digital services seeks to regulate companies, platforms and search engines that are so large and have such a daily audience that, from the point of view of the European Commission, they are strategic platforms that could be put at risk in case of any outages and in case of undesirable behavior the whole company.
Tougher rules for Shein clothing sellers. Rebeka Hengalová from the Europeu Institute explains why
And Shein shows such a monthly user traffic in the European Union alone that it has now ranked among such strategically large online platforms.
What will this online clothing retailer have to change in its operation now?
Shein has until the end of August to implement more significant strategies to protect its consumers, especially minors, beyond existing rules.
The company will need to closely monitor the goods that are sold through their platform. This is not only about clothes, but also various accessories and cosmetics.
It will have to control and combat the trade in illegal goods and strengthen measures to combat hate speech.
An important part of this regulation is also the obligation to submit to annual audits and detailed reporting of its activities so that the European Commission can look into the internal practices of this platform.
What if Shein doesn’t manage to implement the new rules as you just explained in time? Are there fines?
There are fines. The European Commission promises them that if these large platforms repeatedly fail to meet the new conditions, the fines would be so large that it would put the companies out of business.
And thus the European Commission hopes to be able to force the platforms to cooperate.
How has the Chinese company Shein responded so far? Will he comply with the decision of the European Commission, or does he have any reservations?
So far, Shein has released a statement saying they agree with the European Commission’s position and are committed to creating an environment where their European consumers can shop safely and without worry.
In their communication, they also expressed that they will try to adhere to the principles of transparency and accountability, which are the main motto of this regulation. But we’ll see how quickly they manage to implement everything. It is necessary to point out that the European Commission and the Shein company communicate with each other and are ready to help each other somehow.
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Are there reasonable suspicions at this time that Shein is dealing in counterfeit goods or is not fighting enough against harmful content on its site?
Shein is suspected of selling goods that are so cheap that experts and the general public believe that they simply cannot be manufactured in accordance with any labor, safety or product control conditions.
That price tells us that these are low-quality goods, and we can therefore assume that they are obtained illegally.
It is a well-known case that Shein purchases cotton through various external suppliers, especially in the Uyghur region Xinjiang. we knowthat the Chinese government is forcing the Uyghur minority to work there.
Shein has also appeared in several reports with the suspicion that he copies the design of products from small consumers who sell, for example, via the platforms Instagram, Etsy or the well-known Fler in the Czech Republic, but they are so small that they have no way to defend themselves.
And it is the regulation on digital services that will show what all the supply chains of this company look like, what contracts they have and what it tells us about their behavior, so that we can make a decision and have some evidence about whether they are dealing in suitable goods or counterfeit and how we can force them to combat harmful content.
Lukáš Matoška
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