As changes to the laws requiring animal testing for imported cosmetics in China come into effect, RedFern Digital speaks to Mette Knudsen, CEO of certification and regulation compliance company Knudsen & CRC., about the specifics of the changes and the implications for foreign brands looking to tap into the cosmetics market in China – including the new requirement to appoint a liable safety and quality control representative
How did the Chinese government come to implement these new cosmetic regulations?
In the last 30 years, we have not had any new laws within the cosmetics industry in China, so you can imagine how much of a demand there was for these new regulations. The Chinese government has been working on them for around the last three to four years, developing a novel regulatory framework that is both amazing and really complicated in the sense that there are more safety requirements for the products than in any other market.
Therefore, in June 2020, the State Council announced a new cosmetics regulation called the Cosmetic Supervision and Administration Regulation (CSAR), which came into effect on 1 January 2021. As a follow up to this general regulation, on 4 March 2021, the National Medical Products Administration (NMPA) in China released the Administrative Measures on Cosmetic Registration and Notification, which came into force on 1 May 2021. These new measures officially specify that animal testing will no longer be mandatory for imported cosmetics.
What are the regulations that have replaced animal testing requirements?
When selling imported cosmetics that are not tested on animals in China, the products need to have a Good Manufacturing Practice (GMP) certificate or Quality Management System (QMS) certificate, proving that the cosmetics’ manufacturer has passed Good Manufacturing Practice in their home country. The biggest challenge from this is that the certificate needs to be signed off by the government, rather than by a third party, which is what normally happens in Western countries. Once regular cosmetics brands can show proof of a GMP certificate from their home country that is signed off by the government, then they can generally avoid animal testing when importing into China.
Regular cosmetics refers to regular skincare and haircare, as opposed to special cosmetics, which could include hair dye, hair perms, anti-freckle and whitening products, sunscreen, and anti-hair loss products. Products for children are also regulated as special cosmetics, for which mandatory animal testing requirements are still in place.
Although this new GMP requirement has caused a lot of headaches, especially among US brands where they don’t have this kind of mechanism in place, it has been a huge game-changer for cruelty-free cosmetics brands as they can now enter the Chinese market.
How do the new cosmetics regulations differ from the previous ones?
One of the main differences is that animal testing was previously mandatory for all imported cosmetics, and now it is no longer required. However, the new regulations also pose some new challenges when it comes to the safeguarding mechanisms that have been put in place. A lot of documentation and information is required from brands regarding both the product and the raw materials used. The reason behind this is because the Chinese government wants to avoid so-called ‘kitchen sink’ cosmetic products, which are products that contain harmful substances such as heavy metals.
Although a lot of documentation is still required, the entire process and uploading of the information can be carried out online, which makes registering much easier.
Although a lot of documentation is still required, the entire process and uploading of the information can be carried out online, which makes registering much easier. As an example, in the past, companies like Knudsen & CRC. would need somewhere between 500-1000 pages of printed paper to complete a single product registration.
What types of documentation are needed for product registration under the new regulations?
The documentation includes qualification documents of the applicant and production entity, basic information about the product, technical and safety reports such as certificates of analysis, testing reports (including on raw materials), or other documents that indicate the products are safe for use.
In addition, new requirements have also been put in place in which brands making efficacy claims about their products must show proof of these claims through documentation. As an example, if a brand says a product provides anti-ageing effects, then this must be proven through scientific literature, human tests, consumer surveys or lab tests.
As you can imagine, this means that the documentation required for product registration under the new laws is massive but will also help to fight against misleading or false product claims among brands.
Are there any other requirements that brands should know about under the new cosmetics regulations?
One of the new requirements of the law is that both the applicant and the entrusted production entity shall appoint a quality and safety person with more than five years of working experience in the cosmetics industry. This person will be responsible for product safety and quality control, quality management supervision, and adverse reaction monitoring and reporting. If something happens in regards to product safety, then this person is responsible and will be liable, directly facing any punishments imposed by the authorities.
For imported cosmetics registrations, the foreign applicant is also required to appoint a responsible agent (legal entity) in China. This China-based legal entity must fulfil several requirements that include having an office, having a cosmetic business scope, and having at least four or five employees. The legal entity will be responsible for cooperating with the supervision and inspection work of the NMPA, marketing communication and advertising compliance, sales and distribution, assisting with product recalls, adverse reaction regular reporting, warehouse control and the handling of customer complaints.
Can you provide a brief breakdown of the steps that cruelty-free brands should take when entering the China market?
The first step is always to ensure that their trademark has been registered. This is something that we constantly repeat, and yet many brands still don’t do it and then encounter difficulties later because they haven’t protected their trademarks.
The next step is to decide on the owner of the product registration or the responsible person. I would strongly recommend that all brands use the product owner as the owner of the product registration, or at least avoid using the distributor. The reason for this is that the owner of the product registration will have full access to all the information or trade secrets regarding the product formula, production process, and raw material suppliers. We had a very bad case in 2020 where one of our clients provided the product registration to their distributor, who then took everything and copied the product entirely with the information they obtained access to.
I strongly recommend all brands use the product owner as the owner of the product registration, because the owner of the product registration will have full access to all the information or trade secrets regarding the product formula, production process, and raw material suppliers …
The third step is to screen the raw materials. Sometimes brands will use ingredients and raw materials such as probiotics or specific oils that may not be approved in China. In these cases, brands can either decide to re-formulate, to not register in China, or to apply for a new raw material registration, which involves animal testing. As a cruelty-free brand, this may not be an option.
Finally, after determining whether the raw materials are approved in China, the brand will normally decide on the products that they want to register, which is when the actual product registration process begins. Normally, the products will be registered within four to six months, after which the brand can start selling in China. Under the new law, regular product filings are applicable for life, whereas previously the products needed to be re-filed after four years. Special cosmetic registrations are currently still only valid for five years.
How do you see the new regulations changing the timeline for registration?
With the new online system, I think it will make the time to market much shorter. This is a huge advantage for many cosmetics brands, especially colour cosmetics (i.e., makeup), which are almost like a fashion product where the fashionable colours change rapidly. As a result, the shortened time to market will be hugely beneficial.
Are there any parts of the new cosmetics regulations that you anticipate brands will find difficult or confusing?
I think it depends on where the brand is from. If brands are used to European regulations, they will likely not find it too confusing because the regulations are similar, apart from the need for more documentation. For brands from the US, for example, the documentation requirements may be much more difficult to fulfil because they won’t already have it in hand. The brands will need to go back and test everything for the first time, especially when it comes to the raw materials. The responsible person part of the new regulations may also be a point of confusion because of the number of requirements, even among European brands.
Are there any categories where you are seeing a particular trend with the types of brands that will be entering the China market after these new cosmetics regulations have come into effect?
There are no specific categories. Every single brand, from low-end and cheaper colour cosmetics to high-end premium skincare will take advantage of these new regulations. China is growing faster than any other market when it comes to cosmetics and will soon to be the biggest market in the world. Most brands don’t have a choice but to look to China, especially with the new lack of need for animal testing. They need to enter the market to be able to compete in the future, which has caused the demand for registration in China to explode.
Do you have a case study that you could provide us with when it comes to importing a cruelty-free brand into China?
As a part of a pilot programme we started in 2018 and that continues to run today, we worked with a number of regular cosmetics brands to launch into China without animal testing. One of these brands is Australian premium skincare brand Subtle Energies, which is currently being sold at The Peninsula Hotel. The brand is Leaping Bunny certified, which is a cruelty-free certification. To import into China through the programme, Subtle Energies needed to comply with cosmetic regulations, such as using only approved raw materials, while also shifting a portion of the manufacturing process into an approved facility within China.