South Africa is starting to take online complaints seriously. The country’s National Consumer Commission (NCC) has launched a probe into Chinese e-commerce giants, Shein and Temu, which entered the market in 2020 and 2024, respectively, looking into potential violations of the Consumer Protection Act.
Launched in November 2025, the probe is investigating the Chinese e-commerce giants’ marketing claims relative to product quality, labelling, and hidden (platform) fees. The NCC said both companies were notified of the investigation and subsequently confirmed their cooperation.
The investigation was prompted by online complaints from customers about Shein and Temu. If Shein and Temu are found guilty of the customer allegations, they will be required to pay fines up to R1 million ($58,000) or 10% of their annual turnover in South Africa. Worse, company directors could face jail time if they’re unable to prove that the claims are insubstantial.
This isn’t the first time the companies have clashed with regulators.
In 2024, South Africa introduced new tax laws that closed loopholes that allowed companies to drop-ship packages valued at less than R500 ($28.12) from Chinese suppliers to South African consumers without paying value-added tax (VAT). Some international e-commerce companies were exploiting this loophole to avoid paying duties on small-package items, and Shein and Temu were allegedly part of this gang.
International companies lost their pricing advantage because higher taxes made their goods more expensive, reducing the price gap with local retailers, and customers refused to pay more.
Regulators now want Shein and Temu, e-commerce players that came in with a lot of glitz, to be more grounded and compete fairly. The tax change does that; the probe will serve as another corrective measure.
