In March of this year, the European Union’s Digital Markets Act (DMA) entered into force, which regulates companies with large online platforms, such as Apple, Meta, Amazon or even TikTok, but it seems that the popular Shein has already entered into force. must follow these rules.
DMA legislation applies to companies with a user base of several million. Shein, the popular online store that mainly offers clothing, is said to have an average of more than 45 million monthly users in the EU, making it a “very large” company.
The European Commission has therefore drawn Shein’s attention to the new requirements regarding illegal products on its website. The company has four months to submit a risk assessment report and implement mitigation measures a against the sale of counterfeit goods, unsafe products and products that violate intellectual property rights. Shein has been sued by brands such as Oakley and Ralph Lauren for violating their intellectual property rights.
In addition to counterfeit or infringing products on the platform, Shein’s supply chain has also come under scrutiny, mainly due to the working conditions of the people who make the cheap clothes. If the company fails to comply with the rules, they can even ban the platform from the EU, which probably many people would not be happy about, since they also have a lot of customers in our country besides Temu. The e-commerce giant was estimated to be worth $66 billion in 2023.
