Rome (Brussels Morning Newspaper) – Italy’s competition authority (AGCM) announced on Monday that it imposed a 1 million euro fine on China-founded fast fashion e-commerce giant Shein, over the “misleading and omissive” impact of its products on the environmental.
AGCM stated that the messages on Shein‘s website regarding environmental sustainability and social responsibility were sometimes vague, generic, or overly emphatic. In some instances, they were omitted or misleading. The Italian authorities fined Infinite Styles Services Co. Limited, a Dublin-based company managing Shein’s website in Europe, after an investigation into ‘greenwashing’ by AGCM was initiated last September.
How were Shein’s eco-labels considered misleading?
“The company, through the https://it.shein.com website and other informative and/or promotional online pages, has disseminated environmental claims in sections #SHEINTHEKNOW, ‘evoluSHEIN’ and ‘Social Responsibility,’ in some cases vague, generic and/or excessively emphatic, in other cases omissive and misleading,”
AGCM stated in a statement.
Further, the Italian watchdog also said that Shein’s claims could persuade clients that the “evoluSHEIN by Design” collection contains only “eco-sustainable” materials and that products from the collection are recyclable. The AGCM determined that the current fibers and recycling systems used by the company are not accurate.
Shein introduces the ‘evoluSHEIN by design’ collection, highlighting garments produced through more sustainable and responsible manufacturing practices.
What environmental promises did Shein allegedly exaggerate?
The AGCM found that consumers should expect to be misled about the collection being made of eco-materials, and 100% recyclable, when that could not be true due to the type of fibres and how recycling is done in Italy.
In addition, the authority challenged Shein’s “vague and generic” claim to reduce greenhouse emissions by 25% by 2030 and become carbon neutral by 2050, noting Shein’s emissions increased in 2023 and 2024, which contradicted Shein’s claims.
The Italian regulator explained that its overall assessment was affected by an “enhanced duty of care” on Shein, as it nevertheless (even with sustainable claims) acted in an industry where pollution is rampant and relies upon pollution with fast and super-fast fashion.
Why is Shein under increased scrutiny in Europe?
This is Shein’s second financial penalty imposed by a European competition authority in slightly over a month; just previously after France fined Shein 40,000,000 euros (roughly $47.17 million) on July 3, 2023, for deceptive commercial practices such as fake discounts and misleading environmental claims.
The French competition authority determined that Shein misrepresented discount offers by not using the proper reference price in accordance with French law, and even, in some cases, increased the prices prior to applying the discounts.
Moreover, the European Union is also currently examining Shein as it examines alleged violations of EU consumer protection laws against a backdrop of importation restrictions, led by the Consumer Protection Cooperation Network (CPC) made up of national authorities in Belgium, France, Ireland, and the Netherlands, and coordinated with the European Commission. The investigation raises numerous issues about Shein’s treatment of consumers regarding “toxic products”.
The investigation is related to a third ongoing EU investigation into Shein’s compliance with the Digital Services Act after it was designated a Very Large Online Platform in April 2024.
