The European Union is to launch a formal investigation into Chinese retailer Shein over several suspected violations of European laws, including the sale of child-like sex dolls and weapons.
The European Commission said on Tuesday it had launched the investigation after seeking information from the fast-growing company last year.
A senior EU official also pointed to reports of clothing, cosmetics, electronic products that did not conform to EU law.
The inquiry will examine three areas of Sheen’s service which have given cause for concern.
An EU official said that, in addition to the sale of illegal products, it would also look into the “addictive design of the service being provided by Schein”, including bonus points programs, gamification and rewards “that could threaten the mental health of users”.
The investigation will also look into Shein’s recommendation system which can overwhelm users with suggestions of products to buy.
“We suspect that Shein’s system is not designed to avoid the sale of illegal products,” the official said Tuesday. “Illegal products? There are still a lot out there so maybe something isn’t working.”
This is the second investigation launched into the addictive design of the online retail platform, following the investigation launched into Temu in late 2024.
The EU also said that Shein’s recommendation system was opaque and could not meet the transparency requirements of the bloc’s Digital Services Act (DSA).
Under the rules, the recommender must “provide a readily available alternative that is not based on profiling”. What the EU found in its initial investigation was that Sheen only described “in a very general way” how his recommendation system worked.
The European investigation into Shein comes months after the French government backed down from pressure to completely suspend Shein’s services for three months after illegal products were found on the site.
The French investigation is looking at the legality of the products on sale rather than the systemic approach of the sales platform.
At a Paris court hearing in December, a lawyer for the state said Sheen should put controls on his website, including age verification and filtering, to ensure minors cannot access pornographic material.
The French government threatened to suspend Schein in November amid controversy over the sale of child-like sex dolls.
The announcement came as Sheen opened his first brick-and-mortar store in Paris amid a heavy police presence.
EU officials said the investigation is completely separate from the inquiry in France and other assessments being conducted by consumer protection authorities on products that violate trading standards rules at the national level.
“What happened in France is a part of the puzzle but we are looking at the system at large. We are not just focusing on what happened in France,” the senior official said.
The EU first opened its request in April 2024 for information on how platforms do or do not comply with the DSA.
It has now concluded that Sheen believes there is a “low risk” of a breach of EU law on his services. However, the EU argues that Shein poses a “high risk” of selling products that violate EU laws.
The EU said that Shein was cooperating with the European Commission and that the investigation did not mean the service would ultimately be banned, but that a ban on its sales in Europe would remain a “last resort” option if the company did not comply with EU laws.
The Paris Judicial Court acknowledged “serious damage to public order”, but found that the sales of the items concerned were “sporadic”. It said that Sheen had removed the illegal products.
The court nevertheless issued an “injunction” prohibiting Sheen from resuming sales of “sexual products constituting obscene content, without implementing age-verification measures.”
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