Britain’s Financial Conduct Authority (FCA) is taking longer than usual to approve Shein’s London IPO due to concerns raised by the advocacy group Stop Uyghur Genocide (SUG) regarding alleged links between Shein’s supply chain and forced labor in the Uyghur Region. Sources close to the matter suggest the FCA is reviewing the company’s oversight and preparing for potential legal challenges, including a judicial review application.

The global fast fashion giant Shein confidentially filed for the IPO in June. The FCA’s decision is reportedly being delayed as it examines documentation provided by SUG in August, alleging Shein’s use of cotton sourced from the Uyghur Region, a claim the company denies.

Anti-slavery commissioner weighs in

Eleanor Lyons, the U.K.’s Independent Anti-Slavery Commissioner, expressed concerns over the IPO in letters to government departments earlier this year. She warned that listing Shein could be seen as prioritizing economic growth over addressing labor rights abuses.

“The U.K. must avoid endorsing poor labor practices by allowing companies with questionable supply chains to access its markets,” Lyons wrote in June.

Reuters reports,

The Home Office and Department for Business jointly replied that the FCA decides independently on listings and the U.K. has rules to guard against modern slavery.

Like other retailers, Shein must comply with incoming European Union regulations on forced labour and the Uyghur Forced Labor Prevention Act in the U.S., both of which are considered stronger than Britain’s Modern Slavery Act.

Read more