reuters.com
www.reuters.com

cross-posted from: https://lemmy.sdf.org/post/56745331

  • Filing cites general reputational risk from negative publicity
  • Shein does not mention specific China supply chain issues
  • China objected to references to Uyghur forced labour risk in earlier filings, a source says
  • Shein highlights 7,500 contract manufacturing partners and its LATR inventory ​system

[…]

Shein’s Hong Kong IPO filing published on Sunday made no specific mention ‌of risks linked to allegations that its clothes contain cotton from the Xinjiang region.

[…]

Online fast-fashion ​retailer Shein shifted to seeking an IPO in Hong Kong after its supply chain risk disclosure became a major ​sticking point in its attempts to IPO in New York and London, according to a ⁠source with direct knowledge, as China’s regulator could not accept a filing that mentioned Uyghur forced labour as a risk.

Those ​filings included a statement about compliance with the Uyghur Forced Labor Prevention Act, a U.S. law aimed at preventing imports of ​goods produced by forced labour.

In London, the Financial Conduct Authority gave its green light to the filing, but the China Securities Regulatory Commission withheld its approval, effectively blocking the listing, and Shein eventually shifted to a Hong Kong listing instead.

[…]

The legal and political tightrope Shein had to walk was evident at a UK ​parliamentary hearing in January 2025 when Shein’s EMEA general counsel Yinan Zhu avoided answering repeated questions from lawmakers on whether the company uses cotton ‌from China ⁠or from Xinjiang.

[…]

Shein fell to a net loss in the first quarter 2026 [archived link] as US and EU trade tensions hit its business, the fast-fashion retailer reported in a filing ahead of its Hong Kong listing.

Rising trade barriers from the US and EU have hit Shein’s profits, which peaked at $3.4bn in 2024. Net profit was $2bn in 2025.

[…]

The company highlighted the risk of escalating trade tensions between China and its major export markets. A rising number of governments, particularly in Europe, are clamouring for more action to stop cheap Chinese imports flooding their markets and challenging their industries.

Shein remains heavily dependent on Chinese manufacturers for most of its products, despite attempts to diversify its supplier base in other countries, notably Turkey.

[…]