The Shein app is shown in the IOS app store on May 3, 2021 in Bargteheide, Germany.
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WASHINGTON — A House committee studying U.S.-China economic competition released a scathing report Thursday linking retail giants Shein and Temu to a spate of import violations.
Chinese e-commerce companies have reportedly exploited trade loopholes to import goods into the United States without paying import duties or undergoing human rights screening. Discover Released by the House Select Committee on the Communist Party of China.
The report found that under the so-called “minimum” provisions of Section 321 of the Tariff Act of 1930, the brands accounted for more than 30 percent of the packages shipped to the U.S. each day and accounted for the majority of their consumer base through social media. . Import duties are exempted if the fair retail value of the goods does not exceed $800. As of last year, imports were approaching 600,000 shipments per day and could be higher now, the findings show.
Lawmakers argued that the tariff violations gave Temu and Shein an unfair advantage over U.S. retailers. Temu’s valuation is estimated at more than $100 billion, while Shein was most recently valued at $64 billion.
This report is a continuation of the Commission’s report Investigate forced Uyghur labor According to the committee, these findings were documented for the first time, starting with a letter sent to Nike, Adidas, Shein and Temu in May. Temu is operated by Pinduoduo, its Chinese parent company.
Both companies face allegations of human rights abuses: Shein is accused of forced labor at supplier factories in the Uyghur region, while Temu is accused of failing to comply with human rights law. Uyghur Forced Labor Prevention Act, The committee reported.
In addition to reducing tariffs, the loophole would allow the companies to provide U.S. Customs and Border Protection with less comprehensive data, including UFLPA compliance screening, because of the high number of small packages worth less than $800, lawmakers said.
“These results are shocking: Temu did little to keep its supply chain free from slavery,” Wisconsin Republican Mike Gallagher, chairman of the House Communist Party Committee, said in a statement. “Meanwhile, Temu and Shein are building empires around insignificant loopholes in our import rules — dodging import taxes and evading scrutiny on the millions of items they sell to Americans.”
Temu and Shein did not immediately respond to requests for comment on the report. Temu has previously said it was “not the importer of record” for shipments to the US, and Shein has denied the forced labor allegations.
The lawmaker said Temu had asked its more than 80,000 Chinese suppliers to accept language that would ban goods made with forced labor from being shipped to the U.S., but had done little beyond “boilerplate” language to address tariff violations.
Meanwhile, U.S. retailers pay millions of dollars in import duties each year.Clothing brand gap In 2022, H&M paid $700 million in tariffs, H&M paid $205 million, and wedding retailer David’s Bridal paid more than $17 million that year, the report said.
The commission’s investigation is still ongoing.
