A former minister has called on the government to closely scrutinise Shein for possible links to forced working as the China-founded fast-fashion retailer prepares for a stock market listing in London.
Liam Byrne, the Labour MP who heads parliament’s business and trade committee, said the UK should introduce new legislation to increase scrutiny of supply chains that may include products made in the Xinjiang region of north-western China.
China has detained as many as 1 million of the Muslim minority Uyghur people in Xinjiang, and has allegedly subjected many to forced labour.
Shein has risen rapidly to prominence around the world by exporting clothing directly from Chinese factories at very low prices, jumping on the latest trends and putting pressure on western fast-fashion brands.
The Singapore-headquarted company is planning to list on the London Stock Exchange at a £50bn valuation. It had initially planned to list in New York, but reportedly decided on London after opposition from US politicians.
Byrne told the Financial Times he would like to see a British version of the Uyghur Forced Labor Prevention Act from 2021, which bans the use of cotton from Xinjiang by companies in the US.
He said: “My view is that we don’t have a Uyghur Forced Labor Prevention Act in Britain and therefore it’s incumbent on ministers to satisfy themselves that Shein passes the highest standards on forced labour protections. That is something a Labour government might want to address.”
Shein said in a statement to the FT that it had a “zero-tolerance policy” regarding forced labour. A spokesperson said: “Visibility across our entire supply chain is of the highest importance to us and we are wholly committed to respecting human rights. To comply with applicable laws, we not only require that our contract manufacturers only source materials from approved regions but we also verify this independently.”
Shein partners with Oritain, a company that tests the origin of its cotton supply chains. Oritain reported in November last year that 1.7% of Shein’s cotton tested positive for cotton from unapproved regions.
Byrne served in several ministerial roles under Tony Blair and Gordon Brown during Labour’s previous stint in power, culminating in a job as chief secretary to the Treasury. However, he is not a member of the new Labour government under Keir Starmer, instead leading a committee whose job is to scrutinise government policy.
Greater transparency requirements for Shein’s supply chains under any US-style law could make a London listing more costly. In August, Shein admitted it found two cases of child labour and factories failing to pay the minimum wage in its supply chain last year.
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Byrne said that representatives of the New York Stock Exchange earlier this year “said it was clear there were some due diligence issues that hadn’t been cleared” related to Shein’s proposed listing.
Human rights campaigners have called for UK regulators to prevent Shein from listing in London, citing concerns over alleged forced labour in cotton supply chains.
Shein and other Chinese online retailers such as Temu and AliExpress could also be hit by new EU customs duties on small packages. The duties only apply to orders worth more than €150 (£126), meaning China’s direct-to-consumer retailers of smaller goods can mostly avoid them.
Shein was contacted for comment.
