Select Committee Releases Interim Findings from Shein & Temu Forced Labor Investigation

WASHINGTON, DC – As first reported by the New York Times, Chairman Mike Gallagher (R-WI) and Ranking Member Raja Krishnamoorthi (D-IL) of the Select Committee on the Chinese Communist Party today released an interim report detailing the preliminary findings of the Select Committee's bipartisan investigations into Chinese fast fashion brands, Shein and Temu. On May 3, the Select Committee opened initial investigations into Nike, Adidas, Shein, and Temu.

Here’s what Chairman Gallagher had to say about the findings: "These results are shocking: Temu is doing next to nothing to keep its supply chains free from slave labor. At the same time, Temu and Shein are building empires around the de minimis loophole in our import rules—dodging import taxes and evading scrutiny on the millions of goods they sell to Americans. We need to take a hard look at this loophole that is being abused to tilt the playing field against American companies."

Ranking Member Krishnamoorthi added, “The initial findings of this report are concerning and reinforce the need for full transparency by companies potentially profiting from CCP forced labor. Our Select Committee heard from experts under oath that these practices persist to this day and we intend to strengthen laws like the Uyghur Forced Labor Prevention Act to put an end to them once and for all.” 

The report's findings described Shein and Temu's exploitation of US de minimis provisions to evade customs enforcement - wherein nearly all their products are valued under $800 and can enter the United States uninspected and free from duties that most American clothing brands pay. The report also revealed that Temu has no system to ensure compliance with the Uyghur Forced Labor Prevention Act (UFLPA) - all but guaranteeing that shipments made by Uyghur forced labor are entering American homes.

In the report, Chairman Gallagher and Ranking Member Krishnamoorthi identified four specific findings:

Key Finding 1: Temu and Shein alone are likely responsible for more than 30 percent of all packages shipped to the United States daily under the de minimis provision, and likely nearly half of all de minimis shipments to the U.S. from China.

Key Finding 2: Temu’s business model, which relies on the de minimis provision, is to avoid bearing responsibility for compliance with the UFLPA and other prohibitions on forced labor while relying on tens of thousands of Chinese suppliers to ship goods direct to U.S. consumers.

Key Finding 3: Temu conducts no audits and reports no compliance system to affirmatively examine and ensure compliance with the UFLPA. The only measure Temu reported that it takes to ensure that it is not shipping goods to Americans that are produced with forced labor in violation of U.S. law was that its suppliers agree to boilerplate terms and conditions that prohibit the use of forced labor.

Key Finding 4: Temu admitted that it “does not expressly prohibit third-party sellers from selling products based on their origin in the Xinjiang Autonomous Region.”

To conclude, Gallagher and Krishnamoorthi wrote: "These initial and interim findings – which reveal Temu’s failure to maintain even the façade of a meaningful compliance program, and the true scale of both Shein and Temu’s use of the de minimis provision – raise serious concerns about the continued presence of products made with forced labor contaminating American imports. American consumers should know that there is an extremely high risk that Temu’s supply chains are contaminated with forced labor. And all companies operating in the United States have an obligation to clean up their supply chain and ensure that they are not contributing to the CCP’s genocide of the Uyghur people by facilitating the sale of goods made with forced labor."

View a full copy of the Select Committee's bipartisan interim report on the investigation of Shein and Temu HERE.