Shein received UK government approval to debut on the stock exchange

A few days ago, the Chinese fast fashion giant Shein received approval from the UK’s Financial Conduct Authority for its debut on the London Stock Exchange. It’s a huge step for the company, which began the entire process last June. Like every business move in recent months, the brand's plans must also overcome the hurdles imposed by Trump’s tariffs, the American President who, since taking office last January, has imposed heavy duties on all exports. On Chinese goods, the United States currently imposes a staggering 145% tax, along with stricter rules on the country’s duty-free shipments. Shein has confirmed to the Chinese government that it received FCA approval and now must only wait for the China Securities Regulatory Commission to support its stock market entry. Until Trump’s tariffs, the company was experiencing a thriving period, with sales in over 150 countries and a valuation that, in 2023, reached $66 billion. The problem now is that the tariffs imposed on shipments to the United States (one of Shein’s most important markets) risk eliminating the very characteristic that allowed the brand to become a phenomenon: low prices.

Although Shein moved its headquarters to Singapore in 2022, it now has to wait for approval from Chinese authorities because most of the production centers it works with are in China. None of them are owned by the company and there are thousands of factories, about 5,800 third-party manufacturers, which forced Shein to request Beijing’s approval for the listing. The decision will therefore follow Beijing’s rules for Chinese companies operating abroad, explained an external source to Reuters, applied on a basis of “substance over form”. Based on this, authorities outside of the CSRC such as the National Development and Reform Commission or the cybersecurity regulatory authority could influence China’s final decision regarding the company’s stock market debut, since they oversee foreign stakes in local businesses.

The main problem that could hinder Shein’s race to the London Stock Exchange concerns Trump and his signing of the de minimis repeal. Starting from May 2, small shipments (with a total value under $800) from China and Hong Kong will no longer be able to enter the United States duty-free – a factor that significantly impacted Shein’s low prices in America. In response to this change, Shein has moved to find suppliers outside the country, in Brazil, Turkey, and Vietnam, but the Chinese government, fearing that the move could greatly affect the unemployment rate, is opposing the relocation. The company’s listing in London may be further postponed to the second half of 2025, several sources told Reuters. Last year, Shein even tried to go public in the United States, a project it soon had to abandon as the country’s lawmakers were ready to investigate alleged labor and child labor accusations in the company’s supply chain. Faced with all these obstacles, last February Shein was ready to reduce its valuation to $50 billion, $16 billion less than its valuation two years earlier. To find out what awaits Shein’s future, we’ll have to wait for the decision of the CSRC (and the other authorities involved in the matter).