What France’s Anti-Fast Fashion Law Means for Shein

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Hello, happy Friday and a happy Fourth of July weekend to all of our US readers celebrating.

This is Shayeza Walid, BoF’s sustainability reporter, bringing you this week’s edition of The Frayed Edge.

This past week dealt some major blows to ultra-fast fashion players such as Shein and Temu. France passed a historic anti-fast fashion law, Shein recalled a number of its products worldwide after a German environmental watchdog reported toxins in some items and the EU finally introduced a €3 ($3.43) customs charge on small parcels to curb cheap Chinese imports.

While all these legislative changes are on the surface aimed at reducing the environmental impacts of fast fashion, they may do more to benefit European fast-fashion players, which are largely exempt from the surcharges, than to reduce the volume of cheap clothing flooding the European market.

I unpack this tension, what these changes mean for Shein’s business and more below.

So let’s get to it! In this edition:

• The promises and pitfalls of the French anti-fast fashion law
• Fast fashion’s forever chemical problem
• The high risks of forced labour for US and EU fashion

France Takes Aim at Ultra-Fast Fashion

TL;DR: This week, France became the first country to pass legislation specifically targeting ultra-fast fashion.

After more than two years of negotiations, the French Parliament approved a landmark law aimed at “reducing the environmental impact of the textile industry.” The legislation targets designated ultra-fast fashion companies such as Shein and Temu, banning them from advertising in France, including with promotions through influencers. It also penalises them for every sale in the market, starting at €6 per item and rising to €10 by 2030. The penalty sets a cap at 50 percent of an item’s pre-tax sale price, and also requires ads to disclose environmental information to consumers.

The move came two days before the EU separately confirmed it would introduce a €3 handling fee on low-value parcels entering the bloc, ending a customs exemption that has helped fuel an explosion of cheap imports from the Chinese e-commerce platforms.

For Shein, the timing is particularly difficult. The company is already grappling with regulatory scrutiny over labour practices and environmental claims as it gears up for an IPO.

The Caveat: While it has key environmental ambitions, the new legislation is also an exercise in industrial policy.

The bill, which underwent significant revisions over the past two years, differentiates between ultra-fast fashion and conventional fast fashion using criteria such as production volumes, product turnover and business model, meaning companies like Inditex-owned Zara, H&M and France’s Kiabi are expected to face far lighter obligations than Shein or Temu.

Policymakers went as far as introducing what can be seen as concessions for European retailers by narrowing the scope of the legislation so they are not subject to its toughest measures, including the advertising ban and the highest financial penalties reserved for designated ultra-fast fashion platforms.

As New Standard Institute founder and executive director Maxine Bédat pointed out in a recent LinkedIn post, “This is protecting local industry as much as it is trying to limit bad actors.”

The EU’s new parcel fee follows a similar logic. While intended to address the surge in low-value imports entering Europe — more than four billion parcels entered the bloc last year, according to the European Commission — it also responds to mounting pressure from European retailers who argue overseas competitors benefit from customs exemptions.

My Take: For years, policymakers largely relied on voluntary sustainability commitments and consumer behaviour to curb the fashion industry’s environmental impact. France’s law suggests governments are becoming more willing to regulate the business model itself.

But a surcharge alone won’t solve fast fashion’s biggest environmental problem. The legislation imposes a financial penalty on ultra-fast fashion, but it stops short of requiring companies to reduce their environmental footprint or produce fewer garments.

In effect, it puts a cost on the harm rather than preventing it, allowing the high-volume model to survive so long as companies are willing to absorb the added expense. That means overproduction — the industry’s defining sustainability challenge — remains largely unaddressed.

While the French law is an important first step, future regulation will need to go further than only intervening when ultra-cheap imports threaten domestic industries. If legislation continues to focus primarily on where products come from rather than how they’re produced, it could simply redistribute market share among fast-fashion players.

Forever Chemicals in Ultra-Fast Fashion

A Summary: Shein’s regulatory woes continued this week after tests commissioned by German environmental organisation Deutsche Umwelthilfe (DUH) found seven of the 18 items it analysed exceeded EU chemical safety limits. The products contained a range of hazardous substances, including PFAS, heavy metals and plasticisers that have been linked to serious health risks, including cancer and reproductive issues.

Most notably, some PFAS concentrations exceeded EU legal limits by more than 12,000 times, according to the testing. Barbara Metz, DUH’s executive director, said in a statement that “Shein’s clothing is a toxic chemical cocktail by design,” but noted that “the real problem is not just the chemicals in the garments — it is the system behind them.”

For now, DUH said it is taking legal action against the company while Shein said it had removed the products from sale globally while it investigates the findings. “We take the allegations raised by the DUH very seriously,” the company said.

Why This Matters:

On its own, the recall is unlikely to materially disrupt Shein’s business, but the episode highlights a growing vulnerability.

Shein’s biggest competitive advantage has long been its ultra-responsive supply chain, capable of designing, producing and shipping thousands of new products to customers in a matter of days. Its speed has enabled it to consistently outpace rivals on price and trend responsiveness. It also makes oversight significantly more complex.

When products are being launched at such extraordinary volume, ensuring every item complies with increasingly stringent chemical regulations becomes a far bigger operational challenge.

While just a handful of products exceeded EU legal limits, albeit by shocking amounts, the scale of the violations is likely to intensify scrutiny from European regulators already investigating the company on multiple fronts, notably the Digital Services Act over the alleged sale of illegal products and other consumer protection concerns. DUH said it will submit its chemical testing results as part of that ongoing probe.

The result is that Shein’s supply chain, which has been its greatest strength, could become a source of liability.

Forced Labour Risks Are Bigger Than Fashion Thinks

The Key Figures: Nearly all knit apparel imported into two of the world’s biggest fashion markets — the US and Europe — is at high risk of having been tainted by forced labour, according to new analysis by risk consultancy Verisk Maplecroft (VM)

The report found that 98 percent of knit or crocheted apparel imported into the US and 95 percent entering the EU comes from countries classified as having high or very high forced labour risk.

Much of that exposure stems from fashion’s reliance on manufacturing hubs across Asia, where labour rights concerns extend beyond cotton production in Xinjiang to broader risks associated with textile mills, garment factories, migrant labour and weak labour protections across sourcing markets.

While cotton from China’s Xinjiang region remains one of the sector’s best-known forced labour concerns, the report argues the risk is far more widespread and embedded across global supply chains than many companies assume. As a result, brands increasingly need visibility across their entire supply chain, particularly as raw materials, fibres and components often pass through multiple countries before becoming a finished garment.

Why Fashion Should Care: The report lands as forced labour is rapidly becoming as much a commercial risk as a human rights one.

Between June 2022 and February 2026, US Customs and Border Protection detained nearly 42,000 shipments worth $3.94 billion under the Uyghur Forced Labor Prevention Act. Europe is now preparing to enforce its own Forced Labour Regulation, and this week the European Commission published implementation guidelines to help companies identify high-risk products and sourcing regions.

According to Ben Vanpeperstraet, senior EU advisor at human rights organisation Anti-Slavery International —one of the key experts for the bloc’s Forced Labour Regulation — if a single component, from cotton to leather or even buttons, is linked to forced labour, companies may need to recall or remove the entire product from the market. That means visibility deep into the supply chain is becoming just as important as oversight of tier-one suppliers.

“For brands, what would be a more effective strategy towards the future is a zero-tolerance towards inaction,” explained Vanpeperstraete. “So when they’ve found any instance of forced labour here, the best approach would be to say, ‘Let’s fix it before we get under scrutiny.’”

What Else You Need To Know:

Why Fashion Is Falling Behind on Its Climate Targets: While some players in the industry have made progress on their near term supply decarbonisation targets, most are still lagging according to the biggest brands’ latest emissions reports. [The Business of Fashion]

A New Extreme Heat Norm in the Global North: The WHO warns Europe must “plan for heat like winter flu” as this summer’s extreme heat, which fashion was anything but immune from, is likely to become the new normal. As for the US, ahead of the Fourth of July weekend, record heatwaves are also incoming. [Al Jazeera]

Textile Waste Trafficking: Around 4,200 tonnes of textile waste was illegally shipped from Italy to Turkey to avoid expensive recycling requirements, according to a joint investigation by the European Anti-Fraud Office, Italian local authorities and Turkish customs. In Italy, authorities seized company facilities, vehicles said to have been used in the operation, and roughly €12 million in financial assets. [Sourcing Journal]

Nearly 40% of Clothing Is Mislabeled in the EU: A European Commission-backed report published last Friday found that 37 percent of garments tested by market surveillance authorities misrepresent their fibre composition. [The Business of Fashion]

UK Bans ‘Recycled’ Clothing Ads: Ads from Adidas, Uniqlo and Calvin Klein, promoting “recycled” clothing and shoes, were banned by the Advertising Standards Authority, after advertisers were unable to prove their green claims. [The Business of Fashion]