SHEIN reportedly investigated for data handling practices in China

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Chinese fast fashion giant, SHEIN, is reportedly facing a cybersecurity review over data handling concerns by the Cyberspace Administration of China (CAC) amidst its recent filing to go public in the United States (US).

With its upcoming Initial Public Offering (IPO), the CAC will be looking into the nature of data shared with US regulators in the IPO filing, as reported by the Wall Street Journal.

Don't miss: SHEIN files US IPO in bid to expand global reach

The CAC is also reviewing how SHEIN manages its data which includes its partners, suppliers as well as its staff and whether it is able to protect itself from overseas data leaks.

According to a Business of Fashion report, the decision to go public in the US comes as the market for initial public offerings is struggling to rebound after a string of lacklustre stock market debuts. Recent months reportedly saw four major IPOs, three of which disappointed investors.

US politicians have also scrutinised SHEIN in the wake of its IPO plans after its business model raised concerns over labour exploitation and intellectual property violations.

SHEIN has also been in the hot seat recently after UNIQLO's owner, Fast Retailing, filed a lawsuit against SHEIN for selling replicas of its round mini shoulder bag.

According to Fast Retailing’s website, UNIQLO filed a lawsuit against Roadget Business, Fashion Choice and SHEIN JAPAN, operators of the retail brand SHEIN on 28 December 2023 in the Tokyo District Court. The Japanese apparel brand said that the sale of products took reference from the form of its round mini shoulder bag and that this violates the Unfair Competition Prevention Act.

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