The review is focused on potential issues linked to the China-founded retailer’s purchase of a firm that handles Americans’ personal data

US authorities are conducting a national security review of Shein Global Holdings’ purchase of American clothing retailer Everlane after Shein sought approval for the deal, people familiar with the matter said, adding to a growing list of regulatory hurdles for the China-founded fast-fashion giant in one of its most important markets.

The review by the Committee on Foreign Investment in the US (Cfius), an inter-agency panel led by the Treasury Department, began after the US$80 million transaction was completed in May, according to the people, who asked not to be identified discussing private deliberations.

Shein voluntarily initiated the review at that time, which is unusual as companies typically seek Cfius approval before a transaction closes, the people said.

Clearance by Cfius usually prevents future challenges, but the body also has the power to block, unwind or impose conditions on transactions it determines threaten US national security.

A Shein spokesperson said the company is “committed to complying with all applicable laws and regulations in the markets where we operate”. The Treasury did not respond to a request for comment. Cfius reviews are confidential.

Shein maintains substantial operations in China even after it moved its headquarters from there to Singapore several years ago.