MPs have raised serious concerns that the UK could “compromise the integrity” of its financial markets by watering down listing rules to accommodate controversial fast-fashion giant Shein.
In a strongly worded letter to the Financial Conduct Authority (FCA), the cross-party Business and Trade Committee said it would be “deeply concerned” if UK disclosure standards were weakened in a bid to attract Shein’s long-anticipated London Stock Exchange (LSE) flotation.
The intervention follows reports that Shein, a Chinese-founded firm now headquartered in Singapore, has filed confidentially to list in Hong Kong, seen by some as a way to pressure UK regulators into approving a London IPO while sidestepping contentious risk disclosure requirements.
Committee chair Liam Byrne MP warned the FCA that any effort to ease disclosure rules—particularly around alleged human rights violations in Shein’s supply chain—would risk damaging investor confidence and the UK’s global reputation.
“This would not only compromise the integrity of the UK’s listing regime,” Byrne wrote, “but could also risk reputational damage to the UK’s financial markets and undermine investor confidence that the UK was determined to champion only the highest international labour standards.”
Shein has been eyeing a UK listing for over a year and is understood to have secured preliminary approval from the FCA in March. However, progress has reportedly stalled over disclosure language linked to concerns about labour practices in Shein’s Chinese supply chain — a red flag for many UK and international investors.
The Business and Trade Committee now wants the FCA to confirm:
• Whether disclosure risks relating to alleged labour violations are contributing to the delay;
• If the regulator has held discussions about altering disclosure language to facilitate Shein’s listing;
• And what measures the FCA is taking to “safeguard the robustness” of UK listing standards in this and similar cases.
The FCA has not yet responded to the letter publicly.
Shein, once a digital upstart, has become one of the world’s largest fashion retailers, selling cut-price garments direct from factories in China to shoppers in the UK, US and beyond. However, the company has faced mounting scrutiny over alleged forced labour links, particularly in the Xinjiang region — allegations the company denies.
Its attempts to list in both the US and UK have been dogged by political and regulatory resistance, with US lawmakers similarly pressing for greater scrutiny of its supply chains.
Reports that Shein is now pursuing a parallel listing in Hong Kong have been interpreted as a hedge — and a possible tactic to gain leverage in London.
A Shein IPO in London would be one of the largest in a decade and a potential coup for the City, which is battling to revitalise its capital markets following a wave of major companies shifting primary listings to New York.
The government has reportedly been supportive of Shein’s UK ambitions, seeing it as a flagship deal that could encourage more high-growth international businesses to choose London.
But MPs now warn that such a move cannot come at the cost of transparency or ethics.
“The UK cannot send mixed signals about our stance on international labour standards,” Byrne added. “Being open for business must not mean open to exploitation.”
The FCA has been asked to respond to the committee’s concerns and clarify its position on the Shein listing. The regulator’s approach to this case is likely to set a precedent for how the UK balances its ambition to attract global listings with upholding investor protections and ethical standards.
