France’s antitrust agency has announced that it has fined fast-fashion giant Shein 40 million euros ($47.17 million) for alleged deceptive business practices, specifically concerning misleading discounts . The fine comes after a nearly year-long investigation into the China-founded retailer, which is one of Amazon’s biggest competitors in the US.
The agency, responsible for both consumer protection and competition, stated that Infinite Style E-Commerce Co Ltd (ISEL), the entity managing sales for the Shein brand, misled customers about the authenticity of discounts, as per news agency Reuters.
What the rules say and findings of the French agency
Under French regulations, a discount's reference price must be the lowest price offered by the retailer in the 30 days prior to the promotion. The investigation found that Shein failed to adhere to this rule, sometimes even increasing prices before applying a supposed discount, the report said.
The probe, which analysed thousands of products on Shein's French website between October 1, 2022, and August 31, 2023, revealed significant discrepancies. It found that 57% of advertised deals did not, in fact, offer a lower price, 19% had less of a discount than advertised, and a surprising 11% were actually price increases.
What Shien has to say on 40-million-euro fine
In response, Shein stated that ISEL was informed of the breaches related to reference pricing and environmental regulations in March of last year. The company claims ISEL implemented corrective actions within the subsequent two months, asserting that "all identified issues were addressed more than a year ago" and that ISEL is committed to complying with French regulations.
The agency, responsible for both consumer protection and competition, stated that Infinite Style E-Commerce Co Ltd (ISEL), the entity managing sales for the Shein brand, misled customers about the authenticity of discounts, as per news agency Reuters.
What the rules say and findings of the French agency
Under French regulations, a discount's reference price must be the lowest price offered by the retailer in the 30 days prior to the promotion. The investigation found that Shein failed to adhere to this rule, sometimes even increasing prices before applying a supposed discount, the report said.
The probe, which analysed thousands of products on Shein's French website between October 1, 2022, and August 31, 2023, revealed significant discrepancies. It found that 57% of advertised deals did not, in fact, offer a lower price, 19% had less of a discount than advertised, and a surprising 11% were actually price increases.
What Shien has to say on 40-million-euro fine
In response, Shein stated that ISEL was informed of the breaches related to reference pricing and environmental regulations in March of last year. The company claims ISEL implemented corrective actions within the subsequent two months, asserting that "all identified issues were addressed more than a year ago" and that ISEL is committed to complying with French regulations.
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