Photo by Alexander Grey on Unsplash
Should SHEIN and Fast-Fashion Retailers Be Subject to Additional Fines?
In France, lawmakers have paved the way for a significant shift in the fast-fashion landscape. SHEIN and other Asian retailers now face potential fines of up to 10 euros per item sold in France by 2030. This penalty, part of a new bill, aims to curb the proliferation of low-cost, high-volume fashion that’s flooding the market. The bill’s focus on SHEIN underscores broader tensions in the fashion industry. While some applaud efforts to rein in unsustainable practices, others argue that the issue extends beyond specific brands or regions.
The legislation specifically targets retailers like SHEIN, initially proposing a 5-euro penalty per item, set to double by the decade’s end, within a “limit of 50% of the sale price of each piece.” Additionally, advertising restrictions will limit the reach of what the bill terms “ephemeral” fashion companies.
Fast fashion, characterized by its rapid turnover of trendy items at low prices, has drawn criticism for its environmental impact and labor practices. European lawmakers, in a parallel move, are pushing for more sustainable practices across the textile industry.
France’s Minister of Ecological Transition Christophe Bechu emphasized the need to halt textile waste exports, highlighting the bill’s broader environmental goals. Yet, it’s also seen as a measure to bolster France’s domestic textile and retail sectors.
While proponents assert the bill supports local industries and holds polluters accountable, critics argue it unfairly penalizes cost-conscious consumers. SHEIN, in particular, has expressed concern over the potential impact on its business model. Under the proposed legislation, funds collected from penalties would be redirected to support French manufacturers deemed “virtuous.” The aim is to level the playing field between domestic and foreign competitors, with a focus on environmental and labor standards.
Beyond fines, online retailers will be required to disclose the environmental impact of their products. This comes amidst reports of significant textile waste in Europe, where millions of unsold items are destroyed annually.
Fashion’s impact on the environment is staggering. Conservative estimates attribute up to 10% of global climate-warming gases to the industry. To stay within international climate goals, emissions must plummet by 50%-60% in the next seven years. Yet, instead of curbing emissions, the fashion industry is on the path to double them “to around 2.7 billion tonnes of CO2-equivalent” by 2030.
Policymakers are taking notice, with proposals like extended producer responsibility (EPR) gaining traction. However, poorly defined policies risk shifting the burden to low-income countries. Effective EPR should address waste management, hold brands accountable for environmental damage, and promote fair practices.
The bulk of fashion’s emissions occur during production, yet industry leaders resist changes to overproduction and design practices. The European Parliament calls for “a paradigm shift in the fashion industry to end overproduction and unsustainable consumption,” but clear targets and regulations are essential to enforce this change.
Social justice issues also plague the fashion world. Income inequality directly correlates with fashion consumption emissions, with the richest 20% emitting 20 times more than the poorest 20%. To combat this, regulations should target advertising, obsolescence tactics, and impulsive purchasing habits.
In a rapidly evolving landscape, retailers like SHEIN are also facing scrutiny abroad. Allegations of forced labor in its supply chain have raised concerns, potentially complicating its global expansion plans.
As the fashion industry grapples with these challenges, transparency and sustainability are becoming increasingly central to consumer expectations. France’s fast-fashion bill represents a significant step toward reshaping the industry, but its full impact remains to be seen.
Discussion Questions
How can policymakers strike a balance between curbing unsustainable fast-fashion practices and ensuring consumer access to affordable clothing?
As France leads the charge with legislation aimed at penalizing fast-fashion retailers like SHEIN for their environmental impact, what strategies can other nations adopt to incentivize sustainable practices across the textile industry without disproportionately burdening consumers or stifling international competition?
How might collaborative efforts on a global scale reshape the fashion landscape to prioritize environmental stewardship and social responsibility?
Poll
Loading …BrainTrust
Cathy Hotka
Principal, Cathy Hotka & Associates
Dick Seesel
Principal, Retailing In Focus LLC
France’s actions are less about looking after the environment and more about trying to protect domestic apparel manufacturers, designers, and retailers. Justified, or not, it’s basically protectionism.
Personally, I do not like the bill. I think it’s pretty arbitrary in terms of where fast fashion begins and ends. Moreover, slapping a €10 fine per garment is more than onerous and it would, ultimately, push up prices which would deny those at the lower end of the income spectrum the joy of a fashion fix. It is also unclear how France would enforce this if orders were shipped from other EU countries as trade has to be free flowing.
As for the ban on advertising, this is a step too far towards government overreach for my taste.
Great points Neil. The real motive appears to be protectionism for French manufacturers and retailers. If the environmental practices of the companies is the real issue, they should address that directly, not an fine based on the price of the clothing.
Thanks, David. I am curious to see whether the French home grown fast-fashion retailer, Kiabi, is included in these proposals. I expect not!
Of course NO !
WHY ? Because Kiabi is part of Auchan Group, one member of French Oligopoly
“Funnily enough, some of these products sold in France (sourced in Asia & the Middle East) by French Distribution professionals had never caused any problems before!…
.. big retailers, which have organized themselves into a veritable omnipotent Oligopoly (Cartel)…”
A known fine ultimately becomes a type of tax which will be passed along to the consumer as a price increase. If that results in fewer customers, then there are consequences but where is the lost customer to turn? More income inequities.
Exactly!
Our country (the US) has lagged in supporting ethical sourcing. After Rani Plaza, only 2 (I think) US companies signed a commitment to improve the lot of workers.
For better or worse, our corporations basically refused to “follow the rules.” We’re in a place where they make them.
So should we have the regulations? OF COURSE. And it’s easy to use with China based companies. But asking a US based company to follow the same rules? Not gonna happen, sadly.
What a loopy idea. if we started fining retailers for having prices that are too low, where does that begin and end? Should we also train our attention on dollar stores? This may work for France, but would be a disaster here.
It is loopy for France as it is everywhere. This solution does not address the real problem.
This feels less about the environment and more about protectionism. It’s essentially a tariff.
You can criticize SHEIN’s sourcing and labor practices all you want, but does France intend to punish Europe-based fast fashion retailers like Zara in a similar vein?
Who gets to decide which manufacturers and retailers are “virtuous”?
That really sounds like a great way to get the bribe money flowing, relatives cushy jobs, design centers placed in your electoral district, etc.
We know Chinese production has lots of ethical issues, but wow! this action really screams “hold my Chardonnay.”
There are separate and distinct issues at hand and and they need separate and distinct legislative solutions. Some of the economics of new DTC business models need some leveling of the playing field, post haste. The de minimis rules need fixing…yesterday. It’s incredible that they have not already been dealt with. And there is a difference between “affordable” and “so cheap it’s disposable”. Fast fashion isn’t necessarily the problem if it’s data driven and efficiently manufactured with very little waste. That’s part of the reason it’s inexpensive. It’s the “so cheap it’s disposable” factor that’s the problem. So absolutely, deal with the labor issues. Deal with the de minimis issues. Level the playing field at the opening price point level and some of the demand will evaporate. But the efficiencies that are being exercised in fast fashion that lead to informed production with minimal waste should be studied and expanded, not taxed out of existence.
And of course the environmental and sustainability issues need to be dealt with. I still find it hard to comprehend the pictures of the massive landfills with mountains of discarded apparel, but apparently they are real. There are very real after-use costs that are never built into the upfront costs of apparel, so the consumer never pays for those costs. It’s not hard to imagine that some kind of tax or tariff is going to be necessary to pay for some of those costs. And it’s easy to imagine how complicated and messy it would get to formulate and enforce those taxes and tariffs.
This is a quandary, for sure. While the French bill may go too far, the amount of waste and CO2 emissions caused by the fast fashion industry must be addressed. I would suggest that if there are fines for not addressing current practices, there should be incentives for these firms to adopt more sustainable practices. This would have to be agreed upon amongst a consortium of countries vs just France to be effective, but it could strike a better balance and hopefully keep prices on the lower end for consumers.
The fashion industry has a huge problem globally with environmental and humanitarian issues. I agree that something needs to be done. Shine has a lot of problems that need to be discussed, which makes it an easy mark for French politicians. I am not in favor of singling out Chinese companies while ignoring the same abuses that happen in the name of European fashion houses. This reeks of protectionism and xenophobic pandering to voters.
Some politians in France think this is worth votes. Maybe, until the shopper pays 10 euros more.
Will France’s own fast-fashion brand, Kiabi, be included in this legislation? Somehow I doubt it!
This is protectionism, particularly vis-a-vis Asian countries. It isn’t the sold merchandise that is the problem. Why not tax the unsold merchandise? That would focus on the problem rather than where it isn’t. In fact, the proposed legislation may lead to more waste or unsold goods rather than less.
As Dick Seesel notes. This is like a tariff…a tax on the consumer, not on the manufacturer or the retailer.
Penalize the specific problem…unsold inventory. Great suggestion. Retailers would still try to pass that cost along to the consumer, but it shines a very bright light on the problem.
We’ve created this problem as consumers. If we didn’t like the fast fashion fix so much, these companies wouldn’t be in business. As the saying “players gonna play” goes, “producers gonna produce” if there’s people in line to buy the products. Intellectually I understand the reasons behind the bill, and I applaud them, but this is a bandage, not a systemic fix. Consumers will be the ones who ultimately pay the price.
I don’t think fines are a great idea. But the issue of FF waste is growing worse. I just happened to have read this National Geographic article on the problem before logging in here today. We are buying 60% more clothing than we did 12 years ago and keeping it for half as long.
https://www.nationalgeographic.com/environment/article/chile-fashion-pollution
Taxing importers because they have found a unique way of marketing their goods is both poor protectionism in practice, as well as contrary to the free market principles upon which America was founded. This never works well, since it is just the consumer who pays for sanctions (not the importer/manufacturer), since the price burden is carried by the consumer after the sanction is in place.
Funnily enough, some of these products sold in France (sourced in Asia & the Middle East) by French Distribution professionals had never caused any problems before!
Are there margins & commissions (?) that some just won’t let go of?!
French luxury brands are not the main target of Chinese fast fashion, the first victims are the mid-range fashion segment, which has already been wiped out by Amazon and, above all, big retailers, which have organized themselves into a veritable omnipotent Oligopoly (Cartel).
E. Leclerc, today’s most powerful French retailer, has been admitting in the press for decades the price paid for locking out the political and economic authorities… ___________________________________________________________________
TWEET Oct. 22, 2015 – Locking down the authorities, passing the “right” laws at the right time = 10% of a hypermarket’s invest said Michel-Edouard Leclerc MEL (in L’Expansion 1/1989)
https://x.com/JeanDuchaine/status/657156493138120704?s=20
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Fortunately, French supermarkets have largely won the grocery ecommerce battle and crushed Amazon thanks to one basic & disruptive idea, pirated with the complicity of political and economic authorities.