The Italian Competition Authority (AGCM) has fined Asian online retailer Shein €1m for "green-washing". The company, known for its rapid growth in the "ultra-fast fashion" sector at particularly low prices, was accused of misleading customers about the environmental impact of its products. The alleged recyclability of certain textiles was also a focus of the investigation, the authority announced last week.
Specifically, AGCM took action against Infinite Styles Services, the company responsible for managing Shein's sales websites in Europe, because of misleading or deceptive environmental messages ("green claims") used in the promotion of clothing. According to the competition authority, the information on Shein's circularity concept and the recyclability of its products on the Italian online platform and other information channels was found to be "false or at least confusing".
In particular, the use of "green" fibres was emphasized in clothing items from the "evoluSHEIN by Design" line, a collection advertised as sustainable without clearly stating any significant environmental benefits and without indicating that the products in question only make up a marginal proportion of the company's total range. The regulatory authority stated that Shein's communication strategy could also suggest to customers that the collection is made entirely from resource-saving and recyclable materials – "a statement which, given the fibres used and current recycling systems, does not reflect reality".
The ACGM said that in assessing the unfairness of Shein’s conduct, it emphasised the heightened duty of care upon the company, "given that the sector it belongs and the business practices through which it operates, such as the so-called 'disposable fashion' (fast and ultra-fast fashion) are highly polluting".
Shein's vaguely worded climate targets also played a role, along with the company’s pledge to reduce greenhouse gas emissions, which was undermined by an actual increase over the past two years, according to the Italian authority.
"We have strengthened our internal review processes and improved our website to ensure that all environmental claims are clear, verifiable and compliant with regulations", Shein said in a statement, according to the news agency Reuters.
This financial sanction is already the second imposed by a European regulatory authority within a few weeks on the global fast fashion seller, which was founded in China in 2008. At the beginning of July, the French Directorate-General for Competition, Consumer Affairs and Fraud Prevention (DGCCRF) imposed a €40m fine on Shein. The main issue in France was "deceptive commercial practices towards consumers" regarding the extent of discounts, although misleading environmental communication was also criticised.
