The Changing Face of Cosmetics in China: Challenges and Opportunities for China’s Reformed Regulatory Framework
First Published in: Chemical Watch
In the past three years, China has made a great effort to reform its regulatory framework for cosmetics. The Cosmetic Supervision and Administration Regulation (CSAR) came into effect on 1 January 2021, followed by the publication of dozens of supporting documents[1]. The CSAR continues to employ a management system built on risk assessment. It implements a dual-track registration and notification mechanism for both new ingredients and the end-use product, aimed at improving cosmetics compliance throughout the lifecycle.
The National Medical Products Administration (NMPA) has released a series of administrative measures and guidelines to implement the CSAR in 2023. Those documents elaborate on the legal obligations of cosmetics manufacturers and distributors, as well as their suppliers, at different stages in the commercial chain, including:
- from recipe review to pre-market ingredient/product clearance;
- from safety and efficacy evaluation to follow-up audits;
- from production and operation to labeling and advertising; and
- from adverse reaction monitoring to annual reporting.
In this article, we will review the most significant challenges and opportunities for those operating a cosmetics business in the CSAR era in China.
Introduction
First and foremost, the CSAR alters the definition of cosmetics[2] to eliminate products that remove body odour from its regulatory scope. Note, there is no category of "quasi-drugs" or "over-the-counter (OTC) drugs" for personal care products in China. Thus, companies are not allowed to state or imply that their products could aid general physical well-being or prevent disease.
Regarding the inherent risk level, cosmetics are divided into two main categories:
- special cosmetics; and
- general cosmetics.
Special cosmetics are those for hair dyeing, perming, anti-hair loss, whitening, sun screening, and other new functions; any cosmetics not for the above intended functions are general cosmetics. While special cosmetics must be registered with the NMPA following a close review of their safety and efficacy, general cosmetics can be sold once a notification is completed at the local medical product administration (MAP). The registration certificate is valid for five years and eligible for renewal, whereas notification of general cosmetics remains valid for as long as the notified information remains accurate. A cosmetics notification can, nonetheless, be cancelled if its applicant (or agent) fails the post-notification audit or does not submit an annual report in time.
Cosmetics registration and notification have a lot in common in terms of their data requirements and application procedures. The biggest difference is that a notification number will be issued once the application dossier passes the formality check, whereas for cosmetics registration, the approval will not be issued until the product passes the technical review.
Children’s cosmetics[3], for the first time, are specifically regulated by the Supervision and Administrative Measures for Children Cosmetics[4]. Their ingredient use, technical specifications, safety and efficacy assessment, labelling, etc., are subject to a set of independent rules.
It is worth noting that the CSAR confirms that toothpaste[5] is now regulated by separate administrative rules[6] and subject to pre-market notification, referencing the management of general cosmetics. That is to say, ingredients and function claims of toothpaste are subject to positive listing. Toothpaste must be notified to the government before it can be launched in the Chinese marketplace. An NMPA announcement issued on 25 September provided details of the regulatory requirements for toothpaste, which include allowing notifiers of existing toothpaste products to submit a simplified notification dossier by the end of November[7].
Key challenges
Whole lifecycle management starting from ingredients
The CSAR newly includes existing ingredients[8] within its regulatory scope. Pursuant to the Provisions for Management of Cosmetic Registration and Notification Dossiers[9] ("Provisions"), when applying for cosmetics registration and notification, safety information for all ingredients used in the product formula must be included in the dossier. Suppliers of cosmetics ingredients bound for China must therefore:
- obtain a reporting code for each ingredient after submitting the necessary information via NMPA’s online system; and
- share the code with their customers along with a copy of reported ingredient details.
Alternatively, the ingredient supplier can elect to share the required ingredient information directly for its customer’s incorporation in the cosmetics application registration/notification dossier. In the latter scenario, the cosmetics registrant/notifier shoulders the great responsibility of ensuring the authenticity and completeness of ingredient safety information received from its supplier. The deadline for submitting cosmetics ingredient safety information has been extended to 1 January 2024[10].
In the meantime, substances not listed in the NMPA’s catalogue (also known as "new cosmetic ingredients") can only be used in cosmetics intended for China upon completing registration/notification procedures, subject to a subsequent monitoring period of three years[11]. Even if some new ingredients have been widely used overseas, they cannot be readily added to the catalogue without meeting the data and procedural requirements mandated in the CSAR.
Safety assessment and efficacy evaluation
Another challenging requirement raised by the CSAR is the need for the safety and efficacy of cosmetics sold in China to be evaluated and substantiated. More specifically, under the Technical Guidelines on Safety Assessment of Cosmetics[12], full safety assessments of cosmetics will be required from 1 May 2024, after which toxicological assessments will be conducted on each ingredient used in the formula, including local and systemic toxicity assessments, aimed at further ensuring the product’s safety.
Since 1 May 2023, evaluation of cosmetics’ efficacy has also been required – unless an exception applies. Different forms of efficacy data are required to support different cosmetics claims, as per the Specifications for the Evaluation of Cosmetic Efficacy Claims[13]. Special cosmetics that are of high-risk, must be substantiated with the strongest data from, for example, human trial results. By contrast, the efficacy data requirements for cosmetics marketed with claims such as "hair conditioning" and "moisturising," are much more relaxed. Those claims are allowed to be supported by the results of consumer use or lab tests, and even literature research. Those who fail to submit an efficacy evaluation report in time must either revise their product claims or cancel their existing clearance.
Local partner shoulders great responsibilities
Foreign companies must designate a Chinese entity to act on their behalf in each of the above registration and notification procedures for new cosmetics ingredients and products. The authority and responsibilities of the assigned local agent are very high.
The local agent is involved in the whole lifecycle of imported cosmetics in the Chinese marketplace. The application dossier of a foreign manufacturer needs to be signed by the local agent. After the product is cleared, the local agent must respond to follow-up audits by the local authority, track and record all the imported products, stay responsible for the product’s safety, and monitor and report adverse reactions in time. Commonly, the local agent’s prior consent is a prerequisite to the transfer of authority to a new agent.
Bearing the above in mind, many foreign applicants prefer assigning the role of local agent to a Chinese subsidiary. The credential of an authorised subsidiary will be scrutinised in this case. For example, the subsidiary’s capability to ensure product safety will be assessed in the post-clearance audits carried out by the local authority. The background of staff responsible for product safety will be examined closely.
Opportunities
Flexibility with animal testing
The new CSAR offers an opportunity to prove product safety using alternative methods to animal testing. The Provisions for the Management of Cosmetics Registration and Notification Dossiers[14], which came into force on 1 May 2021, exempt companies that produce general cosmetics (including imported general cosmetics), which meet the required conditions, from submitting results of toxicological testing on animals. The alternative method will either be validated by the Chinese government, or well accepted internationally. This is an important milestone for China in the gradual process of replacing mandatory animal testing.
Such exemption is not eligible for all cosmetics manufacturers though. For example, those who produce special cosmetics, or cosmetics targeting infants and children, are not able to enjoy the new cruelty-free opportunity offered by the CSAR.
Pathway created for customising cosmetics onsite
In November 2022, the NMPA granted permission for Beijing, Shanghai, Zhejiang, Shandong, and Guangdong to pilot customised cosmetics services such as skin testing, product tracking, and customised skincare services[15]. The cosmetics that can be customised, as per the NMPA’s notice, are general cosmetics. They cannot contain any new ingredient or target children.
In a follow-up to the NMPA’s notice, in July 2023 the Medical Product Administration (MPA) of Shanghai published its detailed plan[16] for managing cosmetics customisation in its region. It excludes general skincare to be applied on eyes from the scope of cosmetics that can be tailor made onsite. According to the plan, a cosmetics registrant/notifier or local agent whose operational site is registered in the Pudong New Area, can provide onsite, repacking, or sub-packing services upon satisfying the personnel, facility, and operation requirements set forth in the notice.
Similar programmes are expected to be rolling out in other pilot zones in China, providing a unique opportunity to cosmetic suppliers that wish to revolutionise the experience of Chinese consumers.
Concluding remarks
By adopting the Cosmetic Supervision and Administration Regulation, China is not only raising the "regulatory bar" for cosmetic companies to enter the market, but also creating opportunities for those who are committed to investing in China. To do so successfully, however, foreign companies must be aware of the stringent regulatory requirements of CSAR. Choosing a competent local partner and knowing when to consult with the local MPA and third-party expert can make the process more efficient and less burdensome.
This article was first published in Chemical Watch, October 24, 2023.
Footnotes
[1] Order of the State Council No 727 (2020), available at:
http://www.gov.cn/zhengce/content/2020-06/29/content_5522593.htm
[2] Under the CSAR, "cosmetics" refers to "products of industrial chemicals for daily use that are to be applied to the outer surface of the human body, such as skin, hair, nails, lips, etc., for the purpose of cleaning, protecting, beautifying and making up, by way of smearing, spraying or other similar means."
[3] "Children cosmetics" refer to cosmetics suitable for children under the age of 12 (including 12 years old) and have the effects of cleaning, moisturising, toning, and sun protection. Declaration such as "suitable for the whole user group," "use by the whole family," or other declaration that implies that the intended user group of the product includes children will subject the product to the regulation of children's cosmetics.
[4] NMPA’s Announcement on the Issuance of Supervision and Administrative Measures for Children Cosmetics (No 123 of 2021), available at: https://www.nmpa.gov.cn/xxgk/fgwj/xzhgfxwj/20211008171226187.html
[5] "Toothpaste" is defined as "a paste-like product that is applied to the surface of human teeth by friction for the main purpose of cleaning." Oral care products in formats other than paste, such as oral rinse and whitening powder, are commonly treated as industrial products in China unless there is a special claim which subjects the product to drug or disinfectant-related regulations.
[6] Administrative Measures for Toothpaste (effective on 1 December 2023), available at: https://www.samr.gov.cn/zw/zfxxgk/fdzdgknr/fgs/art/2023/art_04c7b62f9106460e8174c8b00adc0347.html
[7] NMPA’s Announcement on Implementing Toothpaste Administrative Measures and Simplifying Requirements for the Notification Dossier of Toothpaste Already on the Market (No 124 of 2023), available at: https://www.nmpa.gov.cn/xxgk/ggtg/hzhpggtg/jmhzhptg/20230925154041194.html; the NMPA is inviting comments on the draft Provisions for the Management of Toothpaste Notification Dossier by 18 October 2023, see: https://www.nmpa.gov.cn/xxgk/zhqyj/zhqyjhzhp/20230925154523115.html
[8] "Existing cosmetic ingredients" refer to those on NMPA’s Catalogue of Used Cosmetic Ingredients ("Catalogue"), available at: https://www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20210430162707173.html
[9] NMPA’s Announcement on the Issuance of the Provisions for Management of Cosmetic Registration and Notification Dossiers (No 32 of 2021), available at: https://www.nmpa.gov.cn/xxgk/ggtg/hzhpggtg/jmhzhptg/20210304140747119.html
[10] NMPA’s Announcement on Matters Related to Further Optimising Management Measures for Safety Information of Cosmetic Ingredients (No 34 of 2023), available at: https://www.nmpa.gov.cn/xxgk/ggtg/hzhpggtg/jmhzhptg/20230327145218196.html
[11] NMPA’s Announcement on the Issuance of Provisions for the Management of New Cosmetic Ingredient Registration and Notification Dossiers (No 31 of 2021), available at:https://www.nmpa.gov.cn/xxgk/ggtg/hzhpggtg/jmhzhptg/20210304140454159.html
[12] NMPA’s Announcement on the Technical Guidelines on Safety Assessment of Cosmetics (No 51 of 2021), available at: https://www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20210409160436155.html
[13] NMPA’s Announcement on the Issuance of the Specifications for the Evaluation of Cosmetic Efficacy Claims (No 50 of 2021), available at: https://www.nmpa.gov.cn/xxgk/ggtg/hzhpggtg/jmhzhptg/20210409160321110.html
[14] NMPA’s Announcement on the Implementation of the Provisions for the Management of Cosmetics Registration and Notification Dossiers (No 35 of 2021), available at: https://www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20210305172050192.html
[15] Notice of NMPA’s Comprehensive Department on Pilot Work of Personalised Cosmetic Services (No 625 of 2022), available at: https://www.nmpa.gov.cn/xxgk/fgwj/gzwj/gzwjhzhp/20221110163204137.html
[16] Provisions for the Management of Onsite Customised Cosmetic Services in Pudong New Area of Shanghai (Trial), valid until 15 August 2025, available at: https://yjj.sh.gov.cn/zx-hzp/20230720/dd902eb950ff4e64865c71827b0909a8.html