Why are Temu and Shein focusing on Europe

With US growth slowing due to tariffs and de minimis rule changes both platforms are boosting European operations supported by redirected ad investment

What are dark patterns

These are manipulative app featureslike countdowns fake stock alerts gamified incentivesthat push consumers toward purchases now flagged by BEUC

The Digital Services Act covers algorithm transparency and advertising ethics Consumer laws and safety regulations also apply to product standards and interface practices

What customs changes are underway

A 2 per parcel handling fee will be introduced and the de minimis exemption for items under 150 will be removedboosting imports oversight and VAT compliance

What product issues are regulators focusing on

Authorities are investigating potential noncompliance with safety norms including harmful chemicals counterfeit claims and misleading labeling

What penalties are at stake

Platforms risk fines up to 6 of global turnover under the Digital Services Act seizure of noncompliant products and reputational damage

How are supply chains adjusting

Both companies must now manage local warehousing VAT registration and logistics challenges across multiple EU jurisdictions

How could this impact the US ecommerce scene

Increased EU regulation may push Chinese platforms to invest more in local operations and safety standards potentially raising prices and narrowing profit margins

Temu and Shein pivot to Europe as EU regulators pursue concerted scrutiny

🔸Published: 10 Jun 2025 01:50 PM

🔸Updated: 10 Jun 2025 04:49 PM

Temu and Shein shift focus to Europe amid U.S. downturn, but face EU probes into dark patterns, product safety, and new customs duties.

Chinese fast-fashion and e-commerce platforms Temu and Shein are accelerating their expansion in Europe, aiming to offset a slowdown in U.S. markets. However, they now face intensified scrutiny from consumer watchdogs and EU authorities over “dark patterns,” product safety, and escalating customs reforms.

Surge in European sales

Temu’s EU sales soared over 60 percent year-on-year in early May, while Shein grew roughly 50 percent in core markets like the U.K., Germany, France, and Spain. Both companies redirected ad budgets away from the U.S. toward Europe following tightening tariffs and the de minimis customs threshold removal

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Dark patterns under fire

The pan-European consumer group BEUC has lodged formal complaints against Shein, citing manipulative UI features such as fake pop-ups, low-stock alerts, countdown timers, infinite scrolling, excessive push notifications, and gamified incentives reminiscent of "Puppy Keep" .
Temu faces similar scrutiny under the EU’s Digital Services Act for potentially misleading product design and algorithmic opacity .

Product safety and customs overhaul

Regulators are assessing compliance with product safety standards amid alarms about potentially toxic textiles and counterfeit goods .
EU authorities are also drafting a €2 handling fee on low-cost parcels and scrapping the de minimis exemption under €150, to offset inspection costs and bolster oversight .

Strategic recalibration amid challenges

Temu and Shein have shifted ad spend to France and the U.K., but face significant logistical hurdles, including fragmented regulations, VAT registration, customs duties, and local warehousing challenges .
Questions remain whether these platforms can sustain growth amid compliance demands and rising costs in the EU.

Temu and Shein are pivoting to Europe as their business in the U.S. takes a major hit from unfavorable trade policies. But the China-founded budget e-commerce apps may not receive a warm reception in their new target markets.#Temu #Shein #Europe https://t.co/2mk290WmaU
— Digital Startup (@digitalstartup5) June 10, 2025

Outlook

The EU’s stepped-up regulatory focus marks a turning point for global e-commerce. Temu and Shein must rapidly adapt their user interfaces, supply chains, and product safety protocols. Pending outcomes from BEUC complaints and customs reforms will be a litmus test for their European strategy.