Need-to-know: The major cosmetics regulatory issues on the agenda for APAC in 2021

By Amanda Lim contact

- Last updated on GMT

Expert insights of industry insiders on the regulatory issues and trends that will affect the cosmetics industry in APAC in 2021. [GettyImages]
Expert insights of industry insiders on the regulatory issues and trends that will affect the cosmetics industry in APAC in 2021. [GettyImages]

Related tags: Regulations, Apac

Here we bring you the expert insights of industry insiders on the regulatory issues and trends that will affect the cosmetics industry in APAC in 2021.

Malaysia: Updated halal rules

In January 2021, Malaysia’s Halal Certification Procedures Manual (MPPHM), Halal Management System (MHMS) and Halal Standards will come into effect.

These documents contain halal certification procedures, internal halal control requirements and halal standards.

Dr Mohd Iskandar Illyas Tan, the CEO of HOLISTICS Lab, estimated that there are around 50% to 60% of changes to regulations related to the cosmetics industry.

One of the biggest changes is related to training. Beginning in 2021, big- and medium-sized companies will be required to attend the Internal Halal Competency Training once every three years.

“For big- and medium-sized companies, it’s compulsory, meaning that if they do not fulfil it, they cannot apply for halal certification because it will be one of the main requirements,”​ said Iskandar.

While it is not compulsory for smaller companies, Iskandar noted that it is ‘highly encouraged’ ​by JAKIM.

The training must be done with a JAKIM-certified halal training provider as the agency is striving to standardise the information and quality of training.

This year, the MPPHM will be updated with additional four standards, bringing the total number of general requirements for halal application to 17.

The additional four standards will affect product menu and services, the measurement system, documentation and records, and lastly, law enforcement and regulation.

Iskandar highlighted that firms should take note of the latter. “JAKIM wants to make sure halal regulations and legislations are part of the documentation, so if a company violates the halal regulations, it can be properly charged, and the law can be enforced.”

According to Iskandar, the biggest hurdle these companies will face is understanding the standards, which he admitted is challenging even for an expert like himself.

“I can see that it might become a bit more complex, but at the end of the day, for medium and big companies, it will be easy for them because they already comply with a certain kind of standard. For micro and small, it will be a bigger challenge.”

In addition, Iskandar noted that it will be more difficult considering that companies will only have two to three months to prepare and comply with the rules.

“These are complex changes. I can see how it can be difficult for a company to understand these regulations, especially if they do not have the resources. The lack of familiarity with all these requirements will create bigger challenges for the industry.”

South Korea: Customised cosmetics

While South Korea currently does not have specific regulations that will take effect in 2021, regulatory analyst Hedy He of Chemlinked predicts that we will see a relatively higher frequency of amendments compared to other APAC countries.

In 2020, South Korea revised its local cosmetics law to allow manufacturers to sell bespoke cosmetic products. These custom cosmetics regulations are the world's first legislation on custom cosmetics.

The law defines personalised cosmetics as products made on the spot by mixing ingredients based on personal preference.

The introduction of bespoke cosmetics was previously banned for sales due to potential safety concerns, but the category is expected to further diversify and expand the K-beauty industry.

Minister of Food and Drug Safety, Eui-kyung Lee previously said during a visit to Amorepacific’s custom cosmetics lab in May 2020 that the customised cosmetics category was the new growth engine for the K-beauty industry.

He said that authorities have recognised the strength of the personalised beauty trend globally and aimed to protect consumers by ensuring the safety of the products.

“The trend of product customisation has prevailed worldwide. Consumers are increasingly demanding products that are formulated based on their unique physiology and individual requirements. To protect consumer rights, the MFDS issued a series of provisions to support and regulate the custom cosmetics industry.”

She noted that smaller companies may have experienced difficulties meeting the administrative requirements of the new regulations.

“One of the major stumbling blocks is that all customs cosmetic sellers shall sign a supply contract with Market Authorisation Holder (MAH) and hire a licensed compounding manager at each store. Therefore, it is expected that the sales of custom cosmetics will be limited to industry giants at the beginning.”

However, He believes that the authorities may be motivated to ease the rules given the growing interest in personalised beauty products.

For instance, she noted that the adoption of skin analysis technology has been gaining momentum in the market and will in turn boost the demand for personalised cosmetics.

“If consumers’ demand for custom cosmetics increases in the future, the regulation will be mitigated,” ​said He.

IFRA: The 49th​ Amendment

In January 2020, the International Fragrance Association (IFRA) announced the notification of its 49th Amendment which considers new methodologies in quantitative risk assessment and aggregate exposure.

The amendments will come into force in May 2021 for new creations and May 2022 for existing creations.

“The 49th amendment is the biggest thing we've ever down as IFRA. It has a very big impact on the fragrance industry and the cosmetic industry at large,”​ said Martina Bianchini, president of IFRA.

Bianchini told CosmeticsDesign-Asia​ that the association was motivated to issue the 49th​ amendment because of the evolution of science and technology.

“In the past, the standards were restricted to what we could measure. Before, we looked at the effects of fragrance of skin, but now we have more endpoints. We don’t only measure dermal absorption now; we have to measure things like phototoxicity.”

The latest amendment also takes into account accumulative exposure from using more than one product.

“We’ve done market analysis on market habits and consumer practices. In today’s world, people like to use different products and they add up,” ​said Bianchini.

Furthermore, the amendments also take into account the environment, measuring for the bioaccumulation of materials.

“We are seeing the trend move towards sustainability as consumers on a global level want to go back to nature. The fragrance industry sources a lot of materials from nature; about one-third of raw materials come from the natural world,” ​said Bianchini.

She highlighted that countries like India have adopted the Nagoya Protocol into mandatory national legislation and expects to see more countries in APAC follow suit.

“Countries like Indonesia is also looking at a Nagoya Protocol-type of legislation because these countries are so rich in natural resources so it’s important to have regulatory sustainability covered.”

In July 2020, IFRA responded to this global trend with the launch of a global sustainability charter that frames what sustainability means for the flavours and fragrance industry.

Since the launch, and more than 30% of the signatory companies are from Asia.

“To date we have had more than 120 companies signing up for this charter and are very keen on having this framework. Among all the companies, 31% of the companies are from Asia. We believe this shows there is a lot of interest [in sustainability] from Asia.”

ECHA: Impact on APAC

In August 2020, the European Chemicals Agency (ECHA) called on the testing of two cosmetic ingredients used exclusively as cosmetic ingredients in sunscreens.

The testing is said to fulfil the requirements of the Registration, Evaluation and Authorisation and Restriction of Chemicals (REACH) Regulation to ensure ‘a high level of protection of human health and the environment from effects of hazardous chemicals’

However, this would require animal testing, undermining the banned implemented by the European Union in 2013.

President of Cosmetic, Toiletry and Fragrance Association of Singapore (CTFAS) Dr Alain Khaiat believes these latest developments will have a huge impact in the next three to five years moving forward.

While ECHA has said it supported the use of non-animal testing methods, Khaiat highlighted that it is not currently possible to do so.

“There are areas of toxicology where we don’t have such test. For instance, when it comes to long-term toxicity, the only way is to run a 90-day test on lab rats and dissect them to find out if there’s a problem or not.”

Khaiat told us that ECHA is driven by the green movement and the concern of long-term effects on human and environmental health.

While he believes the intention is commendable, he stresses that he does not agree the approach ECHA is taking by considering hazard versus risk.

“Many substances we use at low concentrations or not often, so there’s no risk to the health of the individual or the environment. However, if we look at hazard, then things are going to change, because almost every substance has a hazard. ECHA is taking this approach where if there’s a hazard, the ingredient might be banned. This will create a lot of problems in the industry.”

For instance, a banned ingredient would no longer be manufactured and will have repercussions all over the globe, even though it is enforced in the EU.

“Wherever you are in the world, you will have to reconsider your formulations and it will definitely have a huge impact,” ​said Khaiat.

Furthermore, the ban of an ingredient in the EU may cause ripple effects in other regions.

“As a consumer, you can ask your regulators why an ingredient is banned in Europe and not in Singapore. As a regulator, there is a lot of pressure when an ingredient is actually safe but banned in one area of the world,”​ Khaiat explained.

“It’s not a simple thing to manage. It becomes very difficult to explain to the general public that the ban had nothing to do with the risk. It's difficult to explain because it’s too technical.”

China: Beyond CSAR

In June 2020, China’s National Medical Products Administration (NMPA) has published the final version of its Cosmetic Supervision and Administration Regulation (CSAR), which came into effect on January 1, 2021.

CSAR will replace the outdated Cosmetics Hygiene Supervision Regulations (CHSR) which was implemented in 1990 and has been a major hurdle to progress and innovation in the industry.

With the new regulations, the biggest changes will affect ingredient management, safety assessment, efficacy claims.

Alongside CSAR the industry can expect a slew of new draft regulations that will come into effect, such as the Specification for Cosmetics Registration and Filing Materials, Guidelines for Safety Assessment of Cosmetics, Guidelines for the Evaluating of Cosmetics Efficacy Claims, and Administrative Measures on Cosmetic Labelling.

“The best scenario is that once the CSAR come into force, the following chapter regulations will come into force, maybe at the end of this year or early of next year – but I think, it would be the same time as CSAR,” ​said April Guo, general manager, personal and home care division of CIRS.

Among the many changes to expect are the labelling requirements for cosmetic products.

For instance, manufacturers will have to highlight if an ingredient included in the formula is less than 0.1%.

“The government is trying to avoid exaggerated claims so, with this new requirement, the manufacturer cannot claim its product the benefits of a plant extract when they actually use very low concentrations,” ​said Guo.

Additionally, the authorities are trying to cut down on exaggerated claims by only allowing brands to include efficacy evaluations on the labels if it was determined by human trials.

This may push manufacturers to choose to conduct human testing. “Manufacturers who want to make more of a sale point of their products may prefer to choose to conduct their test via human trials,”​ said Guo.

Furthermore, manufacturers with smaller products – less than 15 millilitres or grams – can opt to use an electronic label, such as a QR code.

These requirements will pose a big challenge for foreign cosmetic brands.

“For labelling, these are big changes to note. Foreign manufacturers especially will have to prepare qualified packaging that is consistent with the original and meet the Chinese requirements. This will of course raise the cost and time for them,” ​said Guo.

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