Shein v. Temu: A Copyright Dispute or a Competition Law Battle?

The legal dispute between Shein and Temu may appear, at first glance, to be a simple copyright infringement case. However, the conflict between the two ultra-fast-fashiongiants raises much broader questions about digital markets, platform power, and competition law.

As Shein accuses Temu of copying product photos and benefiting from its brand image, Temu argues that Shein is using its market power and intellectual property rights to suppress competition. Consequently, the case has evolved into a great example of how intellectual property law and competition law intersect in the digital economy.

The Topic of The Dispute

Shein filed a suit against Temu in the UK alleging the sellers in Temu of using thousands of Shein’s copyrighted productphotos to advertise, duplicate or imitate the products on Temu. According to Shein,these actions infringe copyright laws andexploit its commercial success unfairly.

Instead of presenting itself as solely a passive marketplace, Temu accused Shein of conducting an anti-competitive behavior. Temu claims that Shein pressures suppliers not to work with rival platforms, punishes manufacturers that cooperate with competitors, and strategically uses lawsuitsand copyright complaints to weaken competition. Those claims turn the dispute into a debate about competition in digital platform markets.

Exclusive Supplier Practices

One of Temu’s strongest allegations regards supplier restrictions. According to Temu, Shein attempts to force manufacturers into exclusive relationships, discouraging or preventing them from selling products through other competing platforms.

From a competition law perspective, this is significant. Exclusive dealing arrangements are not illegal. However when used by a company with substantial market power torestrict competitors’ access to suppliers or customers they can be problematic.

Under Article 102 TFEU, dominant firms are prohibited from abusing their market position in ways that harm competition. Both companies are non-EU companies however they bota operate in Europe,so the European commerce market is impacted by this matter.

As a result, this act is applicable to the lawsuit. Similar to TFEU, UK Competition Act 1998 prohibits anti-competitive agreements, abuse of dominanceand exclusionary business contracts. Since the lawsuit’slitigated in the UK, this act can also be applied. Moreover if Shein’s practices effectively prevent competitors fromaccessing the supply chain, regulators could interpret this as market foreclosure which gives Temu the right to sue Sheinfor unfair domination over the market.

Intellectual Property as a Competitive Weapon

Another vital  issue is whether intellectual property rights are benim used legitimately or strategically.

Normally, companies are fully entitled to protect their copyrights and trademarks. However, competition law only becomes relevant when legal actions are allegedly used not simply to defend rights, but to burden rivals, increase their costs, or discourage market entry.

Temu argues that Shein’s copyright complaints and lawsuitsgo beyond enforcing ordinary and act as a tool to suppress competition. In competition law theory, this idea is sometimes described as “anti-competitive litigation” or “sham litigation.”

This debate reflects a broader global concern: when does aggressive IP enforcement cross the line into anti-competitive behavior?

Platform Power and Digital Markets

The case also underlines the growing power of dijital marketplaces.

Platforms like Shein and Temu do more than simply connect buyers and sellers. They influence product visibility,pricing, consumer traffic, supplier behavior and market trends through algorithms and data analysis.

This creates strong network effects: the more users a platform has, the more attractive it becomes to sellers, which in turn attracts even more users. Such dynamics can rapidly strengthen a platform’s market position.

As a result, modern competition law gradually focuses on data control, supplier dependency, and platform dominance in addition to price. The Shein vs Temu case is an example of this development.

The Importance of This Dispute

This suit is very important for the present and future of commerce. In a sense, it indicates a huge transformation in global commerce. Competition is no longer limited to price wars between companies. Instead, businesses compete through:

● data,

● algorithms,

● platform ecosystems,

● supply chain control,

● and intellectual property strategies.

The outcome of the case may influence how courts and regulators approach future disputes involving e-commerce platforms and digital marketplaces.

It also demonstrates how intellectual property law and competition law can sometimes pull in opposite directions. On one hand, companies must be allowed to protect innovation and branding.

On the other hand, those protections should not become tools for excluding competitors from the market. Finding the balance between these two is about to turn into one of the biggest legal challenges of the digital economy.

Final Thoughts

The conflict between Shein and Temu is much more than a disagreement over copied product photos. It represents a struggle over dominance in the ultra-fast-fashion market and raises questions about fair competition in digital platforms.

Whether the courts ultimately side with Shein or Temu, the case illustrates a crucial reality: in the digital economy, intellectual property rights, platform power, and competition law are becoming increasingly interconnected.

 

YAZAR: Ada Argun