Shein Fined €40 Million in France for Misleading Discounts and False Environmental Claims

Fast fashion giant Shein has been hit with a massive €40 million fine by French authorities for deceiving consumers about discounts and environmental commitments. It is the largest fine ever imposed in the country for unfair business practices.

The investigation, which lasted eleven months (from October 2022 to August 2023), was conducted by the French antitrust authority and the National Investigation Service (SNE). According to the findings, Shein violated French discount rules and made misleading environmental claims.

Fake or manipulated discounts

In France, discounts must reflect the lowest price in the previous 30 days . However, investigators found that Shein often increased prices before applying supposed “discounts,” making the promotions misleading.

On more than half of the offers analyzed:

57 % did not offer any real discount,
In 19% of cases the discount was lower than declared,
And in 11% of cases, it was even a disguised price increase

Unfounded environmental promises

Shein presented itself online as a “responsible company,” promising to reduce its greenhouse gas emissions by 25% . But during the investigation, it failed to provide any concrete evidence to support these claims, which were therefore deemed misleading.

The company’s response

In an official statement, Shein said it had corrected all the issues more than a year ago , after being notified by the authority. The company also said there had been no impact on the prices paid by customers, and that it remained committed to complying with French regulations.

Investigations also at European level

The fine comes at a delicate time for Shein, which is trying to list on the Hong Kong Stock Exchange after encountering obstacles in the US and UK markets. Meanwhile, the European Commission has also opened several investigations into the company.

The investigations concern alleged violations of consumer protection rules , including the sale of illegal products and unfair contract terms, and possible violations of the Digital Services Act, which regulates large online platforms. In this case, Shein risks a fine of up to 6% of global turnover.

Finally, the European Union is considering introducing a €2 tariff on low-value parcels imported from China, in an attempt to limit unfair competition at the expense of European traders.

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(Featured image by Artem Beliaikin via Unsplash)

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