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Saturday, February 24, 2024

Pressure on Shein and Temu in the US continues

Shein and Temu the two fashion giants from China accused of predatory trade practices, are being haunted by various US human rights groups demanding a ban on their products.

In the latest move, the National Council of Textile Organizations (NCTO) has backed the call to protect the US textile and apparel industry from the unethical practices of these Chinese companies.

Shein is a Chinese online fashion retailer that was founded in 2008. It is known for its affordable and trendy clothing, shoes, accessories, and beauty products. Shein has gained popularity worldwide, especially among young consumers, due to its vast selection of fashionable items at low prices. Temu is a rival Chinese brand that is the main competitor of Shein.

Shein and Temu are accused of exploiting a loophole to evade the Uyghur Forced Labour Prevention Act (UFLPA) under which imports from the Xinjiang region of China are banned on the presumption they were made with forced labour.

A bipartisan group of senators has since long been urging President Joe Biden to substantially step up enforcement and develop a strategic plan to protect the domestic industry.

The loophole is the ‘de minimis’ exemption of the 1930 Tariff Act, under which the direct-to-consumer parcels of the Chinese retail giants are not checked by customs officers – or taxed – as they are worth less than $800.

In a letter to President Biden, the senators warned that without “immediate and improved enforcement against these predatory trade practices”, the US textile and apparel sector faced a “coming disaster”.

NCTO president and CEO Kim Glas said the industry was being overwhelmed by a multitude of compounding factors, including a lack of effective customs enforcement, unfair trade practices fuelled by ‘de minimis’, import fraud, and forced labour.

To maintain the industry’s operations and competitiveness, the administration must take immediate steps to increase its enforcement activities and crack down on systemic abuse that is undermining the very fabric of our domestic textile supply chain and its workforce,” Glas added.

The senators’ letter, led by Thom Tillis and Sherrod Brown, was also signed by Raphael Warnock, Ted Budd, J.D. Vance, Tim Scott, Lindsey Graham, and Ben Ray Luján.

Without urgent action, we will be unable to head off a coming disaster that will substantially undermine textile and apparel production and employment in the US and throughout the Western hemisphere,” said the letter.

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