ARNAUD FINISTRE / AFP
France announced on Thursday a record 40 million-euro fine against e-commerce giant Shein over "deceptive commercial practices" following a competition inquiry, stating that it had misled customers regarding price deals and its environmental impact.
The French competition and anti-fraud office said the investigation found Shein used "deceptive commercial practices towards consumers regarding... price reductions", with the fine handed down with the blessing of the Paris prosecutor's office.
The DGCCRF competition office stated that the nearly year-long investigation revealed the firm had raised certain prices before lowering them.
It added that the China-founded retailer had accepted the fine.
"These practices of greatly discounted prices and permanent promotions give consumers the impression they're getting a great deal," said the DGCCRF.
It was found that 11 per cent of advertised discounts were "price increases".
In 57 per cent of cases, Shein's advertised promotions offered "no price reduction", and in 19 per cent of cases, the price drop was "less significant than announced".
Launched in France in 2015, Shein has experienced phenomenal growth in recent years and captured a significant share of the domestic clothing and footwear market last year, rising from 2% to 3% in 2021, a notable slice of what is a notably fragmented market.
The company, which has become a symbol of the downsides of "ultrafast fashion," is criticised in some quarters for causing environmental pollution, engaging in unfair competition, and tolerating poor working conditions.
In a statement to AFP, Shein said it had taken "without delay" the necessary corrective action within two months of learning of the DGCCRF probe against it in March of last year.
It added that it took its legal and regulatory obligations in France "very seriously" and was committed to transparency.
© Agence France-Presse
