After shopper safety scrutiny dialled up on fast-fashion big Shein within the European Union on Wednesday, the bloc’s government introduced Thursday that it’s despatched a recent request for info (RFI) to the ecommerce platform underneath the Digital Companies Act (DSA), a pan-EU on-line governance framework.
The Fee oversees bigger platforms’ compliance with a subset of DSA guidelines in areas like algorithmic transparency necessities — together with an obligation to provide knowledge entry to researchers to allow them to examine systemic dangers.
On paper, penalties for non-compliance can attain as much as 6% of world annual turnover, though to this point the EU has but to difficulty any DSA fines on any of the designated very massive on-line platforms (VLOPs) or engines like google (VLOSE) — regardless of opening various investigation proceedings and making a number of requests for info to a number of platforms.
The most recent RFI to Shein covers various areas, with the Fee asking the ecommerce big for “inside paperwork and extra detailed info on dangers linked to the presence of unlawful content material and items on its market, on the transparency of its recommender methods, and on the entry to knowledge for certified researchers”.
Per the press launch, it additionally needs extra knowledge from Shein about “measures adopted to mitigate dangers referring to shopper safety, public well being and customers’ wellbeing”, in addition to searching for particulars on the safety of customers’ private knowledge.
The Fee has given Shein till February 27 to reply to the RFI. EU enforcers will then assess its submissions to find out any subsequent steps — which may embody much more requests for information and even step up into a proper investigation continuing.
Shein was solely designated a VLOP again in April final yr however EU lawmakers have mentioned they’re involved about dangers stemming from low value ecommerce marketplaces — such because the distribution of harmful and/or counterfeit merchandise, or environmental harms from a flood of low cost, low high quality items.
Competitors issues posed by an inflow of low high quality items into the EU single market are additionally preoccupying the bloc. And yesterday the Fee unboxed a technique concentrating on this sweep of points. Albeit, a number of what was introduced within the Communication on Secure and Sustainable E-Commerce is pending because it nonetheless must be agreed by co-legislators earlier than it may be applied.
Customs reforms is one plank of the technique EU lawmakers are pushing for. Nevertheless proposed modifications there require Member State buy-in.
In the mean time, Fee officers talking at yesterday’s press briefing had been eager to level out that varied present legal guidelines already apply on low value ecommerce platforms, from product guidelines to shopper safety legal guidelines and the bloc’s on-line governance framework.
Within the latter case, imposing related elements of the DSA, which — in addition to the aforementioned algorithmic transparency and accountability necessities — embody restrictions on anti-consumer techniques like darkish patterns — is squarely within the Fee’s reward in its position overseeing VLOPs’ compliance.
At present’s announcement of one other RFI on Shein thus seems supposed to maintain up stress and underscore that the bloc is already taking motion. Though Fee spokespeople didn’t have interaction with our questions asking why the EU has not additional stepped up enforcement on this space in gentle of clear issues expressed yesterday, similar to associated to product security and shopper safety.
Nonetheless, whereas the EU has but to opening formal investigation proceedings on Shein (or low value rival Temu), despite a number of asks for information, it has — since March final yr — had a DSA probe open on one other market, AliExpress. That probe covers points together with danger mitigation, content material moderation, advert transparency, algorithmic accountability, the traceability of merchants, and knowledge entry for researchers.
Shein has been contacted for a response to the newest Fee RFI.