The EU executive suspects the marketplace breached the law because it didn’t properly assess and mitigate the risks of illegal goods being sold on the platform, a senior Commission official said in a briefing with journalists. These goods also include unsafe toys and cosmetics.
The Commission is also investigating the addictive design of Shein’s platform — specifically its bonus point programs and the gamification of the shopping experience — which may harm consumers’ mental and physical wellbeing, the official said. The scrutiny also extends to Shein’s recommender system and its transparency.
Shein takes its “obligations under the Digital Services Act seriously and have always cooperated fully” with European regulators, said company spokesperson Martin Reidy.
Reidy said the platform has in the last few months made investments “significantly in measures to strengthen” its compliance, such as “comprehensive systemic-risk assessments and mitigation frameworks, enhanced protections for younger users, and ongoing work to design our services in ways that promote a safe and trusted user experience.”
Shein said in January it was putting age checks in place to make sure underage users can’t access items they shouldn’t — a bid to address concerns that the site was failing to protect children from adult items such as regular sex dolls.
The Commission is monitoring how Shein puts these age checks in place, another official said. But it doesn’t have enough evidence to start an investigation into whether the platform also violated provisions around the protection of minors.
Ireland’s regulator, Coimisiún na Meán, is also sending a request for information to Shein on Tuesday, specifically looking into its protections for minors, the first Commission official said. Ireland has jurisdiction over Shein because the platform’s EU headquarters are located there.
Tuesday’s announcement comes as the Commission is accelerating the enforcement of its DSA platforms law. It announced this month that TikTok is in breach of the rules and should make significant changes, including to infinite scrolling, to avoid penalties.