State Attorneys General Ask SEC to Bar SHEIN IPO Unless Forced Labor Compliance Certified

Sixteen state attorneys general are asking the Security and Exchange Commission to block the listing of SHEIN -- or any other foreign-owned firm -- on a U.S. stock exchange unless a "truly independent" certification can be made that the company does not export goods made with forced labor.

Their letter, released to the public on Aug. 28, alleges that "SHEIN’s growth has been built on nefarious business practices." They said those practices include violating the Uyghur Forced Labor Prevention Act by using Xinjiang-grown cotton, "blurring the lines of intellectual property and copyright" as its contract manufacturers seek to exploit trends.

And, the officials, led by Montana Attorney General Austin Knudsen, complain that the “de minimis exception," as they termed it, makes SHEIN's shipments "less likely to face the same customs scrutiny as other retailers."

The group, citing a 2021 story from Reuters about lack of compliance with U.K. forced labor disclosure laws, said SHEIN had "a documented history of lying about its labor practices."

"An IPO of this magnitude -- involving a foreign-owned company that is facing credible concerns about its core business practices -- cannot move forward on self-certification alone," they wrote. "American exchanges should have a zero-tolerance policy for foreign companies that seek access to our markets but refuse to follow our laws, especially when the implicated laws are meant to prevent serious human rights abuses."