Only a few days after 25 European consumer organizations submitted a complaint against Shein due to misleading practices at the beginning of the month, the Chinese Ultra-Fast-Fashion giant is again in the crossfire.
This time the online shopping giant faces a lawsuit in front of the British High Court. According to ‘The Telegraph’, Shein is accused of “manipulation of customs declarations for VAT evasion” in the documents.
The lawsuit was submitted by the customs agent IT Way Transgroup Clearance and Orange Transgroup. This worked as an agent for Shein between 2021 and 2024 and demands that this compensation of £ 5.8 million.
Orange Transgroup claims that Shein put it under pressure and damaged its reputation. Shein also incorrectly presented the package responsibility.
Shein rejects these claims. “The allegations made against Shein are completely unfounded. Shein adheres to all relevant laws and regulations in every market in which it works. Shein will rigorously defend and follow its legitimate interests,” says a speaker.
De-minimis control: a thorn in the eye of US, British and EU companies
However, the competition has complained about the practices of Shein for years; Not only in Great Britain, but also in the EU and the USA.
The United States has already restricted tax exemptions for so-called ‘de-minimis programs’, that is, those that fall below a certain value of the goods-135 pounds in Great Britain, 800 US dollars in the USA or 150 euros in the EU-and thus from import tariffs. However, the VAT is always charged regardless of the value of the goods. As a result, Shein has increased its prices in the United States.
Great Britain is currently considering closing the legislative gap; Finance Minister Rachel Reeves has promised to check them. The EU is also currently revising its de-minimis rules. It takes into account the unfair competition for European companies, potential security risks and loss of income for the customs authorities. France faces a law against Shein.
This article was used with digital tools translated.
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