China Launches Data Review into Shein Ahead of US IPO, Reports WSJ

China’s top cybersecurity watchdog, the Cyberspace Administration of China (CAC), is reportedly conducting a data review into Shein as the fast-fashion company seeks approval for its initial public offering (IPO) in the United States, according to the Wall Street Journal. The investigation is said to focus on Shein’s ability to safeguard data on its China-based staff, suppliers, and partners, ensuring it does not leak overseas. Additionally, the CAC aims to determine the data that Shein must provide to US regulators in preparation for its New York listing.

The review by the CAC, a process that has historically taken months, could potentially lead to delays in Shein’s planned stock sale in the US. If significant flaws in data handling are identified, Shein might be compelled to abandon its IPO plans entirely.

China has been tightening control over information generated by its tech companies, with the CAC playing a prominent role in ensuring data security. The government’s efforts align with its broader strategy to position China as a leader in big data, investing heavily in digital infrastructure such as data centers. In recent times, Beijing has intervened in the plans of several Chinese firms to list overseas, prompting some to withdraw from the US capital market.

Notably, ride-hailing startup Didi Global Inc. delisted from the US after facing a probe by Chinese authorities in July 2021, and ByteDance Ltd., the parent company of TikTok, reportedly suspended its plans to go public due to regulatory concerns about data security. Both cases highlight the growing influence of Chinese regulators in overseeing and controlling data-related activities of domestic tech companies. As of now, neither Shein nor the CAC has officially commented on the reported data review.


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