US Investigates Shein and Temu Amid Labour and Safety Allegations

Post by : Mina Rahman

The US is intensifying its scrutiny of fast-fashion giants Shein and Temu, prompted by lawmakers who have called for investigations into serious allegations of forced labour, intellectual property theft, and safety risks concerning their products.

Texas Attorney General Ken Paxton has initiated a probe into Shein, a move that resonates with ongoing inquiries in Europe. In parallel, Senator Tom Cotton has urged a federal inquiry into both brands, labeling them as platforms contributing to the detriment of American enterprises through IP theft.

Responding to these concerns, Shein has affirmed its commitment to cooperating with the Texas investigation. The company, headquartered in Singapore, sources a significant portion of its goods from China. Temu has yet to issue a public statement regarding the allegations.

Senator Cotton pointed out that newly implemented US regulations eliminating the tariff exemption for inexpensive shipments have resulted in millions of packages from China being left in warehouses, thus presenting a significant opportunity for federal oversight. He has accused Temu of offering counterfeit merchandise and claims that Shein profits by replicating US designers' work at lower prices.

The investigation led by Paxton will delve into Shein’s employment practices involving forced labour, the use of potentially hazardous materials, misleading marketing strategies, and their data handling methods. He reiterated the importance of safeguarding Americans from “inexpensive, hazardous, foreign products.”

Moreover, both firms are subjected to heightened scrutiny in Europe, where Shein faces demands to restrict sales of inappropriate items like childlike sex dolls and weapons, while Temu is currently investigated in France for exposing minors to harmful content.

This scrutiny reflects a wider trend of regulatory actions aimed at foreign digital and retail platforms, further exemplified by recent lawsuits against Roblox concerning alleged safety infractions.