December 02, 2025
US Senator Calls for Federal Investigation into Shein and Temu over Counterfeit Goods
A U.S. Republican senator has called on federal authorities to open a formal investigation into fast-growing online retailers Shein and Temu, escalating regulatory scrutiny over alleged intellectual property violations and the sale of counterfeit goods.
Senator Tom Cotton of Arkansas has sent a letter to Attorney General Pam Bondi urging both the Department of Justice and the Department of Homeland Security to examine what he described as “wide-scale intellectual property theft” tied to the two e-commerce platforms. Both companies ship most of their goods from China and are known for selling ultra-low-priced clothing and accessories to customers in the U.S. and other global markets.
The request follows the end of the U.S. de minimis trade exemption, which previously allowed packages valued under $800 shipped directly to consumers to enter the country duty-free with limited inspection. That rule was widely credited with enabling the platforms’ rapid rise in the U.S. by allowing millions of small parcels to bypass the normal customs screening processes applied to bulk imports.
According to Cotton’s letter, the removal of the exemption has forced both companies to shift their logistics models away from direct international shipping toward domestic warehousing and distribution centres inside the United States.
International Pressure Builds
Pressure on both platforms has also been growing outside the U.S. In July, the European Commission warned that Temu was not doing enough to stop counterfeit goods on its platform, saying the company had breached EU rules on marketplace oversight. Temu said it would cooperate fully with the investigation.
In the U.S., action is not limited to federal authorities. Texas Attorney General Ken Paxton has launched a state-level investigation into whether Shein broke consumer protection laws related to labour practices and product safety. In France, a Paris court has also been asked to suspend Shein’s operations for three months following complaints about inappropriate and banned items being sold on its platform.
CX Implications
The investigations bring renewed focus to platform responsibility for product safety, authenticity, and quality — areas that directly influence customer trust. While low prices continue to attract shoppers, inconsistent product standards, counterfeit items, unclear seller accountability, and complicated returns have been ongoing sources of frustration.
Tighter oversight could change day-to-day operations on these marketplaces, including stricter product checks, more controlled seller onboarding, and reduced listings. These steps may increase costs or affect delivery speeds, but regulators say they are necessary to ensure consumers receive safe, legitimate products.
