Consequences of the CSAR

COSSMA: The previously valid Cosmetics Hygiene Supervision Regulations is already 30 years old. What were its weak points?

Seongmin Sohn: After thorough evaluation, the 30-year-old regulations no longer fit the current industrial environment or market conditions. They are administratively inconvenient, and have led to unreasonable, ambiguous interpretations. These issues have been improved with the new CSAR (Cosmetics Supervision and Administration Regulation). 

There are many other reasonable underlying factors to why the new regulations are necessary today. The Chinese cosmetics industry has become an important industry, considering it was never of much inter-est to the authorities. In addition, if advanced regulations are intro-duced during the industrial infancy or growth period, it could hinder the development of domestic industries. 

From an administrative aspect, the old management system lacked practicality and convenience for all parties and considering the industry growth, a new system was needed to improve efficiency. At the same time, authorities concluded that the atmosphere to protect their own markets and promote industrial growth was ripe. It is believed that the timing of the revision was adjusted in a surprise manner to check the inflow of overseas products into the precinct and, at the same time, to strengthen the competitiveness of domestic players in China. In short, it was just ‘a time for a change’.

What is special about the new Cosmetic Supervision and Administration Regulation (CSAR)?

The new CSAR consists of six chapters, with a total of 80 provisions. The major changes are the penalties facing the industry, impacting areas such as cosmetics ingredient management, product registration, and advertisements. However, by bringing in the IT system, product registration procedures and data submissions have been simplified. The eight major changes to the regulations are as follows:

Scope of application 

The regulation states that “it is a daily chemical industry product with the purpose of cleansing, protecting, beautifying, and grooming by applying or spraying on the surface of the human body such as skin, hair, nails, and lips”. Therefore, although it is not applicable to ordinary soap for simple cleansing purposes, the new regulation also applies to whitening soaps included for special cosmetic purposes. Additionally, toothpaste shall also be implemented in accordance with the new cosmetics regulation.

Classification

The new CSAR classifies cosmetics into special and general cosmetics, whereas previously, this was known as special and non-special cosmetics. 

The old regulation classified special cosmetics into nine categories: hair growth, dyeing, perm, hair removal, breast care, slimming, deodorant, whitening (freckle removal), and UV protection. Whereas now, the new regulation is categorised by just five products under special cosmetics: perm, whitening (freckle removal), UV protection, anti-hair loss and other new functional cosmetics. By reducing the categories under special cosmetics, the CSAR can be more specialised and specific. 

The National Drug Administration (NMPA) established and announced detailed standards which align with the new CSAR regulations to increase efficiency and standardise the product criteria. The new standards involve providing information on cosmetics efficacy, application area, ingredient types, and user groups.

Ingredients management

A new regulations factor has been added to the CSAR: “natural and artificial ingredients used in cosmetics for the first time in China”, essentially, new cosmetic ingredients. New high-risk ingredients, including preservation, UV protection, colouring, dyeing, freckle removal and whitening, and other high-risk materials require National Medical Products Administration (NMPA) registration and pre-approval. Low-risk ingredients must be notified to the NMPA. Compared to previous regulations, this system is much clearer and involves less regulatory hurdles to register ingredients in cosmetics products.

After the pre-registration or notification of a new ingredient, there is now a three-year safety monitoring period. If a safety issue arises, the NMPA will investigate the issue. If the ingredient is deemed to be unsafe the notification and registration will be withdrawn. After three years, the products which have no safety issues will be added to the Inventory of Existing Cosmetic Ingredients in China (IECIC). Additionally, the NMPA has announced a ‘list of prohibited ingredients for cosmetics’.

Safety manufacture and quality control

To ensure product quality, com-panies must strengthen their management of manufacturing technology, personnel, and quality inspection. It is necessary to deploy professional personnel who conduct product safety evaluations. Employees must have expertise in their field with at least five years of related professional experience. In addition, a health management system for the production personnel is required to ensure the quality safety of cosmetic products.

The CSAR state that cosmetic production teams must now establish management systems such as raw material management, production and quality management, facility management, product inspection and sample management, and recall procedures.

Also, companies must establish a tracking system to enable product tracking and record production, inspection, and sales, whereby the record retention period is at least two years.

Labels and advertisements 

Regulations related to cosmetics labels have also been strengthened. Labels should be attached to the individual products that are sold and labelling the entire ingredient list of the product is now mandatory.

Cosmetics advertisements must have scientific grounds. When promoting the efficacy of products and ingredients, scientific evidence such as assessment data, test data, and academic research results should be provided. Furthermore, any promotional or advertising phrases without clear scientific evidence fall under false or misleading marketing.

Imported cosmetics 

These must be reviewed by the National Product Inspection Ministry. Only products that have been approved are allowed to be imported. Special cosmetics must be registered by the NMPA, whilst general cosmetics can be notified where the registrant is located.

When applying for the registration, evidence related to the quality management of overseas companies as well as documents that prove the manufacturing process and sales should be submitted. In the case of products imported to China, related research and experimental data conducted on Chinese consumers should be submitted.

The validity period of the registered special cosmetics is now five years and must be renewed 30 days prior to the expiration.

Sales Management

The regulation stipulates that cosmetics e-commerce platforms must take responsibility for product quality. The e-commerce platform must register a real name for cosmetics entrants, immediately report to the drug supervision and management department should an illegal act be discovered, and the sale should then be banned.

Punishment

Stronger penalties are now imposed on illegal activities such as unauthorised production, use of prohibited or unauthorised ingredients, sale of unregistered products, and products under poor quality standards.

What are the biggest changes that the CSAR brings for cosmetics industry?

Some call the new CSAR “a full-scale Registration Era’, where all the detailed information and relevant data should be submitted as a new product or ingredient enters the Chinese cosmetic market. Regardless of whether a company is entering or already part of the Chinese market, they must now reveal all information from ingredient details, to finished product efficacy data. Some of these new regulations cause more time, energy, efforts, and cost throughout the compliance process.

For new companies, the gateway for new cosmetic ingredients is much wider than ever before, so with the new technology and the confirmed safety of products, the CSAR allows for a very promising new market era. 

How does the CSAR affect international companies that serve the Chinese cosmetics market?

The changes for international companies are like those experienced by Chinese companies, but due to geographical distances and language barriers, it takes more time, energy, and money for international companies to register and use the system. For global companies that have a large sales market in China, they now must reveal all the information behind the product, such as formulation details and ingredient supplier details.

What are the possible weaknesses of the CSAR? 

I understand the importance of requiring full data submission, but I find it can be too confidential compared to the regulations outside China. Also, requiring full disclosure on efficacy of ingredients is a very timely and costly process to be required on demand from companies. Some efficacy categories and testing methods are unclear and vague. This is something which should be focussed on in future updates of the CSAR. This is also the case for registering new ingredients where unspoken conditions or underlying double interpretation remains. 

How will the CSAR change the Chinese, Asian and global cosmetics market?

The administration process of cosmetic products and ingredients will be much easier going forward, and there are no doubts that the accumulation of this enormous data set will eventually accelerate rapid growth due to the competitiveness of the Chinese beauty industry. 

The new system provides a comprehensive and standardised method which allows for future localised use, like the approach used internationally, such as, in France, US, Japan, Germany and South Korea. It can also be a good model of regulation for the authorities in other regions and can be selectively adopted. One example of this is the South Korea government who are to implement Cosmetic Safety Assessor regulation within the market. These changes might be just the beginning of ‘a non-tariff barrier era’ in the entire Asian market, and everyone will be putting in more effort than ever before to comply with local regulatory changes.