A record fine. The Chinese Ephemeral Fashion Giant Shein was inflicted a fine of 40 million euros for “deceptive business practices” after a survey by the General Directorate of Competition, Consumption and the Repression of Frauds (DGCCRF), announced on Thursday this direction of the Ministry of Economy.
The survey of the repression of fraud reveals in particular “the implementation” by the Infinite Style E-Commerce Ltd (ISEL) company, responsible for sales of Shein products, “misleading commercial practices with regard to consumers on the reality of the price reductions granted”, said the DGCCRF in a press release.
Record amount for this type of offense
The fine was “proposed” with “the agreement of the public prosecutor of Paris” and “at the end of a transaction procedure”, specifies the DGCCRF. This is a record amount for this type of offense.
Concretely, it is notably accused of Shein for increasing “certain prices before applying a reduction to them”, or of not having taken into account “previous promotions” when it indicated a reference price. “These profusion of barred prices and permanent promotions thus give the consumer the impression of making very good business,” explains the DGCCRF.
However, she noted that “57% of the announcements verified” during the survey offered “no price drop, 19% a lower drop than announced and 11% were in reality price increases”.
To conduct its survey, the repression of fraud in France explains that it has noted on the Shein website “prices of several thousand products (sale price, barred prices and reduction percentage)” between October 2022 and August 2023.
“Maintains its vigilance”
Another action denounced: “deceptive business practices” on “the scope of commitments concerning environmental allegations” of Shein.
The Chinese group claims to have “implemented the necessary corrective shares, completed within two months” after being notified by the DGCCRF “in March 2024”. “The set of points raised” by the DGCCRF survey “has therefore been treated for more than a year,” said the company, specifying that “these adjustments have had no impact on the final prices offered to consumers”.
Shein also assures that ISEL takes “very seriously its legal and regulatory obligations in France” and remains “fully committed to transparency and compliance with French regulations”.
For its part, the DGCCRF indicates that it “maintains its vigilance on the evolution of the practices observed at the end of these investigations”.
