The European Commission (EC) has officially designated fast-fashion online retailer Shein as a Very Large Online Platform (VLOP) under the Digital Services Act (DSA) regulation in European Union (EU) law.
This announcement comes after the two parties held talks over compliance under the regulation in March 2024.
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With over 45 million monthly users in the EU, the retailer reaches the threshold for a VLOP.
The retailer joins major tech companies such as AliExpress, Amazon, Meta and TikTok, already classified under the Act.
As a VLOP, Shein is now obligated to comply with the most stringent rules of the DSA within four months of its notification, which sets the deadline at the end of August 2024.
The classification subjects Shein to rigorous regulations aimed at ensuring content moderation, user privacy and safety.
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By GlobalDataThe company must adopt specific measures to protect users online, particularly minors, and to mitigate systemic risks posed by their services.
This includes a thorough analysis of the risks related to the spread of illegal content and products, as well as the design and functioning of its service.
Shein is also required to implement measures to counteract the listing and sale of counterfeit goods, unsafe products and items that violate intellectual property rights.
The company will need to bolster its internal processes, resources, testing, documentation and supervision to detect systemic risks effectively.
The EC, in cooperation with the Irish Digital Services Coordinator, will supervise Shein’s adherence to the DSA.
The commission will closely monitor the platform’s compliance, particularly concerning consumer protection and the distribution of illegal products.
The commission has expressed readiness to work closely with Shein to ensure these issues are properly addressed.
Since 17 February 2024, all online platforms, including Shein’s online marketplace service, have been required to comply with the general obligations under the DSA.
This designation of Shein comes one year after the EC adopted the first designation decisions, with a total of 23 currently designated VLOPs and Very Large Search Engines (VLOSEs).
