The EU is investigating Shein for its ‘addictive,’ gamified service

• The EU is investigating Shein for having an "addictive design" and selling illegal products.
• The European Commission said Shein uses points and rewards for engagement, which jeopardizes consumer well-being.
• Shein has been the subject of numerous probes in recent years.

The European Union is going after Shein for hooking customers with what it calls "addictive design."

In a press release on Tuesday, the European Commission announced that it had launched a probe into Shein under its Digital Services Act.

The Commission said it would investigate Shein for "addictive design, the lack of transparency of recommender systems, as well as the sale of illegal products, including child sexual abuse material."

Shein's platform is addictive because it uses points and rewards for engagement, the Commission said in the press release, which could jeopardize consumer well-being. Shein, a Chinese fast fashion brand, is headquartered in Singapore.

The Commission added in the release that it would investigate the systems that Shein has in place to limit the sale of illegal products in the European Union, such as "child-like sex dolls."

The probe comes after the French government tried to have Shein's website suspended in the country last year after reports of sex doll listings on the site.

Reuters reported in December that a Paris court had rejected the suspension and ordered Shein to implement age verification for adult products and impose a fine for any breach.

This is not the first time the EU has taken action against Shein for its marketing tactics.

In May, the bloc accused the company of deceiving customers with fake discounts and misleading information, failing to process refunds, and hiding the contact information of customer service agents, which it called a "breach of EU law."

Shein has also been the subject of probes by other countries. South Korean authorities found toxic substances in quantities above legal limits in Shein's products on numerous occasions.

And in December, a Texas court said it would investigate Shein for "unethical labor practices and the sale of unsafe consumer products."

"Any company that cuts corners on labor standards or product safety, especially those operating in foreign nations like China, will be held accountable," Texas Attorney General Ken Paxton said in a press release.

Representatives for Shein did not respond to a request for comment from Business Insider.

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