China Threatens France Over New Shein and Temu Levy as Paris Defends 'Eco-Friendly' Fashion Crackdown

France has begun imposing new levies on Shein and Temu, known for their affordable items, as the nation recently implemented the anti-ultra-fast-fashion law. The law was passed in June and promulgated in July.

For China, the law is discriminatory, with Commerce Ministry Spokeswoman Huang Ling stating the nation's 'firm opposition to France's insistence on pushing forward this trade-restrictive measure, which is clearly discriminatory'. For France, the law is merely to 'protect the environment and consumers.'

€20 Per Garment

With the new law, the levy is expected to reach close to €20 (£17.17 / $23.25) per garment by 2030, as France slowly curbs fast-fashion items. Consulting firm McKinsey & Company describes fast fashion as: 'With a focus on ultralow prices and condensed production cycles, fast fashion gets new styles to customers at a record pace—and creates sizable environmental and social challenges.'

Based on the newly implemented legislation, France considers ultra-fast fashion based on the volume of clothing placed on the market and the cost of garment repair compared to the purchase price.

The ultra-fast fashion distinction is the reason why H&M, Mango and Zara do not feel targeted by the new law. These European brands do not produce the same quantity of items as Shein and Temu.

'China urges France to immediately halt the implementation of the anti-ultra-fast fashion law,' Huang said in a press conference. 'Should France persist in this course of action, China will take necessary measures to safeguard the legitimate rights and interests of Chinese enterprises.'

She added: 'France will bear full responsibility for all consequences arising from this.' However, Huang did not specify what retaliatory action it will impose on France.

'Not Discriminatory'

A source from the French Foreign Trade and Attractiveness Office told European media that it does not want to tangle with China. However, the new law was 'not discriminatory '.

'It is in everyone's interest, including China's, to have a peaceful relationship with France, with the European Union, and a civil trade relationship,' the source said. 'The fact that China feels targeted is indeed something we have heard. We are of course ready to talk to them to understand to what extent they feel targeted.'

'If China has technical issues with the law, it is perfectly entitled to submit them to the World Trade Organization (WTO),' the source continued. 'Our Parliament is sovereign and has had its say. It has passed this law and we will fully respect its decision. This kind of threat, this challenge to a state's sovereign position, is coercion, economic retaliation. But for now, it remains a threat.'

2026 Levies

According to the new French law, per-garment charges this year range from €0.50 (£0.43 / $0.58) for underwear to €2 (£1.71 / $2.33) for T-shirts. Meanwhile, jeans get a €9 (£7.71 / $10.47) levy per item and jackets are pegged at €12 (£10.28 / $13.95) per piece.

There is a levy cap of 50% of every product's pre-tax price. However, there is still a chance that the levy could reach €19.50 (£16.71/$22.60) per item by 2030.

When reports of the legislation first came out, Chinese-founded Shein told a British publication that the law would only 'worsen the purchasing power of French consumers, at a time when they are feeling the impact of the cost-of-living crisis.' Temu, for its part, said it is an online marketplace and should not be part of the ultra-fast-fashion conversation.