• Shein faces EU penalties over consumer law violations, including fake discounts and misleading labels.
• The European Commission has given Shein one month to address these issues or risk fines based on their EU sales.
• Practices under investigation include pressure selling, fake deadlines, and incorrect information on returns.

The European Union has warned fast-fashion retailer Shein about potential fines due to multiple breaches of EU consumer protection laws. The violations identified include practices such as fake discounts, pressure selling, and misleading sustainability claims. The EU emphasized the urgency for Shein to respond, granting the company one month to address these concerns or face enforcement actions, which may include financial penalties based on its turnover in EU member states, according to Channel News Asia and South China Morning Post.

The investigation, which began in February, uncovered a range of deceptive practices, including instances where Shein purportedly offered discounts that were not genuine and created false purchase deadlines to pressure consumers into quick decisions. Additionally, misleading or incorrect information regarding return policies was noted. EU officials have stated, “It's now for Shein to step up, respect the rules and bring its practices fully in line with EU consumer standards,” as reported by BBC and Business Insider.

Shein's operational model, characterized by rapid shipping of inexpensive products, has come under scrutiny as the EU seeks to enforce compliance with its consumer laws rigorously. The bloc's consumer authorities are collaborating with national agencies in various countries to ensure that Shein addresses these critical legal issues within the outlined timeframe. Failure to comply may result in substantial financial repercussions for the retailer, according to Channel News Asia and South China Morning Post.