We Must Shut Down Shein
The grave national security threat posed by China and Chinese Communist Party (CCP) interests in America is widely known. From spy balloons to TikTok, there is no question China will act aggressively and with disregard for normal business practices to achieve its ends.
Yet, while China and TikTok have captured the attention of United States lawmakers, SHEIN – a CCP-controlled fast-fashion company and among TikTok’s largest advertisers – continues to operate below the radar. Ask anyone over 30 if they know about SHEIN and the odds are high they have never heard of this operation. TikTok and SHEIN, controlled by the CCP, are trying to capture an entire generation of American youth. And in a way, they already have.
SHEIN has become a fast-fashion juggernaut by likely violating U.S. law, committing “crimes against humanity” and engaging in anti-competitive and nefarious business practices. Their ability to do all of this is built off of making U.S. consumers, mostly our kids and young women, unwitting accomplices to all of it.
The UN has described slavery abuses in China as “crimes against humanity.” SHEIN has been linked to cotton picked by forced laborers (slaves) in Xinjiang, in direct violation of the Uyghur Forced Labor Prevention Act.
SHEIN is likely violating the UFLPA, federal law that states “any goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part” in Xinjiang Uyghur Autonomous Region (XUAR) of China should be assumed to be the product of forced labor unless proven otherwise by “clear and convincing evidence.” Not only has SHEIN refused to provide that evidence, independent lab testing on SHEIN products confirmed that SHEIN shipped garments to the U.S. made with cotton from Xinjiang.
SHEIN is exploiting a U.S. tariff loophole by not reporting its imports in the aggregate, as is typically done. Instead, it turns each individual customer in the United States – typically young women and teens – into the importer. As long as the order is below $800 USD, it does not trigger reporting requirements to U.S. Customs and Border Protection, meaning they’re not subject to the scrutiny applied to every other retailers’ bulk imports. SHEIN avoids tariffs AND puts the legal responsibility to prove it is not using slave labor onto American consumers.
As a result of this strategy, SHEIN sold over $10 billion of Chinese made goods in the U.S. without technically importing any of them.
SHEIN has driven a container ship through a loophole in import laws to avoid paying billions of dollars in tariffs. A Coalition for a Prosperous America report estimates the value of de minimis imports into the U.S. at $128 billion last year.
By using slave labor, evading U.S. tariffs and targeting American youth, SHEIN is able to charge less for its products and undercut law-abiding businesses.
A cabal of Chinese and U.S. investors, including venture capital group Sequoia China, private equity group General Atlantic, and hedge fund Tiger Global, are profiting from SHEIN’s anti-competitive practices and aiding and abetting crimes against humanity. These VCs, PE and Hedge Funds will do anything for profit and don’t care about the health of the U.S. and its citizens.
SHEIN is harvesting data on American children, their parents and even their friends.
In 2021, it was reported that concerns we “mounting … about the sinister surveillance tactics employed by Shein to get ahead of its rivals.” Tom Tugendhat, current Minister of State for Security and former chairman of the Foreign Affairs Committee for the U.K. government, accused Shein of “surveillance capitalism.”
SHEIN is the next Amazon, but with nefarious intent. Amazon started selling books and no one paid attention until it became a juggernaut, dominating every sector of the economy. SHEIN is the Amazon of fast fashion, but soon enough will be evading billions more in taxes and tariffs crippling U.S. retailers in the process, all while harvesting information on as many Americans as possible for the CCP, not just teenagers.
TikTok was the most downloaded app globally in 2022, with 672 million downloads and a recent report stated that SHEIN was the most talked about brand on TikTok.
SHEIN is the No.1 downloaded app in both Android and iOS App Store’s Shopping category in the U.S. with 229 million downloads, beating out Amazon by almost 34 million downloads.
SHEIN has an “unusual” marketing strategy that heavily targets teenaged and twenty-something American “influencers.”
SHEIN’s website ranks #1 in the world for web traffic in the fashion and apparel category, according to SimilarWeb, putting them ahead of household names Nike, Zara, Macys, Lululemon and Adidas.
A recent survey of American upper income teens by investment bank Piper Sandler ranked SHEIN as 2nd after Amazon for most popular shopping website.
The average duration of a site visit is estimated at 8 mins 36 seconds, higher than every major US fashion brand.
The Indian government banned SHEIN in June 2020, among 59 apps, including TikTok and WeChat, that it deemed “prejudicial to sovereignty and integrity of India, defence of India, security of state and public order.”
SHEIN conducted a funding round this year that put its value at $100 billion, exceeding that of rivals H&M and Zara combined. The company’s global revenue topped $16 billion last year, and it’s on track for $24 billion this year. A third of that is estimated to come from the US.
Shut Down SHEIN is a growing coalition of like-minded individuals and businesses committed to increasing the awareness of SHEIN’S dangerous and reprehensible behavior. Existing laws need to be enforced to hold SHEIN accountable for its use of Uyghur materials and forced labor to make its products, its exploitation of American laws by using unwitting minor children all over the nation as “importers,” and avoiding billions in tariffs with a business model that disadvantages American businesses and taxpayers. Shut Down SHEIN recognizes that, much like Amazon started with books, SHEIN is using inexpensive apparel advertised on TikTok as a precursor for its expansion into all retail sectors subsidized by billions more in tariffs to crush law abiding American businesses, unless it is stopped now.