Shein, a fast-fashion company founded in China, will now have to adhere to stringent new EU online content regulations as its user base surged beyond a crucial threshold, the European Commission announced on Friday.
The Commission stated that Shein, along with numerous other Big Tech entities, falls under the ambit of the regulations.
According to the Digital Services Act (DSA) of the EU, companies surpassing 45 million users are classified as very large online platforms (VLOP).
These VLOPs are mandated to intensify efforts in combating illegal content, harmful material, and counterfeit merchandise on their platforms.
With a recent report revealing 108 million monthly active users in the EU, Shein finds itself designated as a VLOP.
Consequently, the company is obligated to comply with the most rigorous regulations outlined in the DSA within four months of notification, by the end of August 2024, as per the EU executive’s statement.
Under the DSA provisions, companies must implement specific measures to empower and safeguard online users, particularly minors.
Moreover, they are required to assess and mitigate systemic risks arising from their services.
Shein expressed its commitment to abiding by these regulations. Leonard Lin, the global head of public affairs at Shein, affirmed the company’s alignment with the Commission’s goal to ensure a secure online shopping experience for consumers in the EU.
Shein launched its marketplace in the EU in August of the preceding year, coinciding with the DSA’s applicability to all online platforms since February 17.
Notably, sixteen tech firms, including Amazon, Apple, Alibaba, Microsoft, and three pornography sites, are subject to the DSA.
The Commission has requested information from some of these entities regarding measures taken to combat illegal content and goods sold online.
Furthermore, the EU is actively investigating social media platform X and ByteDance’s TikTok for potential violations.
Companies found in breach of the regulations could face fines amounting to as much as 6% of their global turnover.