The UK Financial Conduct Authority (FCA) is extending its review period for the proposed initial public offering (IPO) of the global fast-fashion brand Shein, as it scrutinises the company's supply chain management and evaluates potential legal risks, as reported by Reuters.
The development follows an objection to the listing by an organisation advocating for the rights of the Uyghur community in China.
The UK's Independent Anti-Slavery Commissioner, operating under the auspices of the Home Office, has also expressed apprehension regarding Shein's potential market debut due to allegations surrounding the labour conditions at its supplier locations.
Shein, headquartered in Singapore with a product range of budget-friendly attire predominantly manufactured in China, confidentially submitted its IPO filing to the FCA in June 2024, aiming for a spot on the London Stock Exchange.
Shein is also awaiting clearance from China's own securities regulator for its London IPO, which is expected to follow a decision from the FCA.
The group Stop Uyghur Genocide (SUG) made public its intent to legally contest the listing in June 2024 and delivered a report to the FCA in August, accusing Shein of utilising cotton sourced from Xinjiang, a region at the centre of international human rights controversy.
Concerns are increasing over the Chinese government's actions toward the Uyghur population, with allegations of compulsory labour practices.
Advocates for the Uyghur community express apprehension about potential cultural obliteration. Nations such as the US, Canada and the Netherlands have characterised China's conduct towards Uyghurs as indicative of genocidal intent.
The UK has not officially concurred with this characterisation and maintains that such determinations are best left to the jurisdiction of global judicial bodies.
Shein maintains that it strictly opposes forced labour and upholds human rights commitments.
In its sustainability report released in August 2024, Shein also disclosed the detection of two instances of child labour within its supply chain during 2023, but no evidence of forced labour.
The company has formed an international advisory board focused on environmental, social, and governance (ESG) issues to strengthen its corporate governance practices.
In October 2024, the group’s UK subsidiary, Shein Distribution UK, reported £1.55bn ($2.03bn) revenue in the year to December 2023 – a 38% rise from the previous year.
