Shein, the controversial fast fashion giant whose popularity soared during Covid, may soon tighten its ties with the UK with plans to sell shares in the business on the London Stock Exchange.

The Chinese firm could file the relevant paperwork as soon as this week, potentially valuing the company at $66bn (£51.7bn).

Shein’s formula of offering a huge range of cheap clothes – backed up by campaigns with social media influencers – has turned it into one of the biggest fashion retailers in the world.

But it has faced severe criticism over its environmental practices, as well as allegations around the use of forced labour in its supply chain.

A spokesperson for Shein declined to comment.

The company is looking at the UK as a place to sell its shares after facing hurdles and intense scrutiny in the US. Shein filed documents in the US last November.

Some US lawmakers raised concerns about Shein’s links to China as tensions between Washington and Beijing intensified.

Shein relies on thousands of third-party suppliers, as well as contract manufacturers, near its headquarters in Guangzhou, China.

It is able to turn around a new item in a matter of weeks, having sped up the “test and repeat” model, first used by the likes of Zara owner Inditex, where companies place small orders of clothing items, see how they perform with shoppers before ordering more if they are a hit.

If Shein chose the UK over the US, it would be a significant boost for the City of London.

A UK share listing generates significant business for the wider financial services industry that still makes up more than 10% of the UK’s entire economy.

After several firms have opted for the US instead, the UK government has been scrambling to make the country more attractive for companies to set out their stall.

Shein may choose to file the initial paperwork – known as a prospectus – with the Financial Conduct Authority this week, sources said, or it could happen later in June.

Filing a prospectus with the FCA is a required first step for any company that wishes to sell shares on the London Stock Exchange.

“This could be big news for the London stock market,” said Colleen McHugh, chief investment officer at Wealthify, the investment firm, told the BBC’s Today programme.

But she admitted the company may face some difficulties over claims about how it conducts business.

The filing with the financial watchdog is a necessary first step but doesn’t guarantee that a float will go ahead.

Last year, a group of US lawmakers called for Shein to be investigated over claims that Uyghur forced labour is used to make some of the clothes it sells.

“We have zero tolerance for forced labour,” Shein told the BBC at the time.

Meanwhile in May, a report suggested that workers for some of Shein’s suppliers are still working 75 hours a week, despite the company promising to improve conditions.

The investigation by Swiss advocacy group Public Eye found that a number of staff across six sites in the manufacturing hub of Guangzhou were doing excessive overtime.

According to the group, who interviewed 13 employees from six factories in China supplying Shein, excessive overtime was common for many workers.

Shein told the BBC it was “working hard” to address the matters raised by the Public Eye report and had made “significant progress on enhancing conditions”.

On a London listing, Ms McHugh said: “It’ll be down to the regulator as to whether or not the listing can go ahead here [in the UK] – but it won’t be without controversy.”

Shein’s executive chairman Donald Tang is an American citizen who was a former banker for Bear Stearns in Asia.

He has met with both Chancellor Jeremy Hunt and Jonathan Reynolds, the shadow business secretary, in recent months to discuss the possibility of floating in London after hitting resistance from regulators and lawmakers in the US.