SHEIN acquisition of Everlane faces US national security review

The Committee on Foreign Investment in the United States (CFIUS) is reviewing the $80 million acquisition of American apparel retailer Everlane by the Chinese fast-fashion giant SHEIN. Although the transaction was completed in May, SHEIN proactively applied for the review, a move described as unusual since companies typically seek approval before closing a deal.

The investigation focuses on potential national security risks regarding the access to sensitive American consumer data. Authorities are examining whether the acquisition could allow for the collection of personal information, including names, addresses, financial data, and geolocation, as well as potential vulnerabilities within supply chain information and logistics software.

This scrutiny occurs amid heightened US-China competition over data privacy and security. While SHEIN has moved its headquarters to Singapore, it maintains significant operations and regulatory ties to China. The review comes as SHEIN faces additional legal and regulatory challenges in the US, including investigations by the Federal Trade Commission and legal actions regarding consumer protection and product safety.