France’s regulatory authority, the National Information and Freedom Commission (CNIL), handed down a hefty fine of 150 million euros (approximately 176 million US dollars) to the Chinese fast-fashion brand “Shein” on Wednesday (September 3). The fine amounts to about 2% of the company’s European revenue in 2023. The investigation revealed that Shein’s French website implanted cookies and tracked users without consent when they rejected them, violating the EU General Data Protection Regulation (GDPR).
According to a statement from the CNIL, a test conducted in August 2023 on Shein’s French website found that even after users chose to reject cookies while browsing, some cookies were still installed on users’ computers without consent. These cookies could allow the website and advertisers to identify users and track their browsing habits.
The statement highlighted that Shein’s actions clearly violated the GDPR’s requirement of obtaining user consent before collecting data. According to the regulation, cookies are considered personal information that can be used to identify consumer habits and deliver targeted advertising, which requires user consent before use.
Considering that Shein’s website in France receives an estimated 12 million visits per month, reaching a large audience with a widespread impact, the CNIL decided to impose a hefty fine of 150 million euros (176.1 million US dollars). This fine accounts for about 2% of the 76.84 billion euros in revenue reported by Shein’s European company registered in Ireland in 2023.
In its statement, the CNIL wrote, “The amount of this fine takes into account the company’s multiple violations, including implanting cookies without user consent, disregarding user choices, and failing to properly inform users of relevant information.”
In response, Shein strongly opposed the penalty, claiming that the fine was excessive and stating that they would appeal. The company asserts that since August 2023, they have fully cooperated with the investigation, taken corrective measures actively, enhanced user data protection, and ensured full compliance with the website, thus deeming the fine amount too high.
In addition to information security, Shein’s price competition in France has also drawn attention from authorities. Shein offers products in France at very low prices, such as dresses for as low as 12 euros and jeans for around 20 euros, but it has faced criticism locally.
French lawmakers are pushing for a bill targeting fast-fashion brands, including Shein, to regulate their excessive production and prohibit certain advertising or promotional practices. If the bill is passed, Shein may be prohibited from advertising in France.
(Translated and adapted from a report by Reuters)