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Navigating the Ever-Changing Regulatory Landscape in China, Part II

September 29, 2015 | Contact Author | By: Karen Yarussi-King, Global Regulatory Associates, Inc.
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Keywords: regulation | China | Asia | Chinese | food | drug | administration | CFDA | formulating | ingredient labeling

Abstract: In an unlikely turn, the Chinese government has embraced a Western approach to cosmetics regulation. However, it comes with a traditional Chinese twist.

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K Yarussi-King, Navigating the ever-changing regulatory landscape in China, part II, Cosm & Toil 130(8) 12-15 (Oct 2015)

Earlier this year (C&T January/February 2015), I provided an update to the dynamic regulatory environment in China. Well, true to form, the Chinese government has again surprised the cosmetic industry in the latest draft of its cosmetic regulations.

Various trade associations, including the Personal Care Products Council and Cosmetics Europe, worked with the U.S. government and World Trade Organization to address industry concerns with the Chinese Food and Drug Administration (CFDA).

In an amazing twist, the Chinese government has been receptive to the feedback from the global cosmetic industry on their previous draft. The latest draft of the Cosmetics Supervision and Administration Regulations (CSAR) resembles a more Western approach to regulating the cosmetics industry but, of course, with a Chinese twist.

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Earlier this year (C&T January/February 2015), I provided an update to the dynamic regulatory environment in China. Well, true to form, the Chinese government has again surprised the cosmetic industry in the latest draft of its cosmetic regulations.

Various trade associations, including the Personal Care Products Council and Cosmetics Europe, worked with the U.S. government and World Trade Organization to address industry concerns with the Chinese Food and Drug Administration (CFDA).

In an amazing twist, the Chinese government has been receptive to the feedback from the global cosmetic industry on their previous draft. The latest draft of the Cosmetics Supervision and Administration Regulations (CSAR) resembles a more Western approach to regulating the cosmetics industry but, of course, with a Chinese twist.

Raw Materials

The CFDA will now issue catalogs of prohibited, restricted and permitted ingredients, updated on an annual basis. The model will be similar to the EU Annexes. Previously, industry could only choose from ingredients on the approved positive list, which was not regularly updated to include innovations in raw material technology, particularly with skin care ingredients.

As a result, many cosmetic manufacturers were forced to provide different formulas designed specifically for China. This development will help cosmetic manufacturers by allowing for a single global formula, which in turn, will hopefully provide economies of scale production savings.

It appears the CFDA also has changed its thinking on adding new ingredients to the permitted catalog. While clarity is still being sought, new ingredients not considered to be high-risk can be added by the manufacturer of a domestic product or agent of an imported product within 30 days of its use in the manufacturing process. This allows manufacturers or agents to place a product on the market immediately after the ingredient’s listing. In addition, the manufacturer or agent will need to report on the use and safety of new ingredients semi-annually for their first three years of use.

The cosmetics industry is also asking that raw material manufacturers be permitted to apply, since they are the primary source of ingredient data.

Finished Products

The CFDA has divided products into two categories: special and ordinary cosmetics. The Chinese government will create a catalog of special cosmetics that manufacturers will be able to review to determine if their product is considered a special cosmetic.

Currently, special cosmetics include hair dyes, perms, whitening products and sunscreens, as well as other cosmetics considered to require special administration—although authorities of the state council have not yet defined what criteria would cause a product to require special administration categorization. Any cosmetics falling outside of the special criteria are classified as ordinary.

It appears the notification process for ordinary cosmetics will be greatly reduced from what previously required months, to just 10 days. The Chinese government must be notified of new domestically produced products 10 days before their manufacturing begins. The government must also be notified of imported products 10 days prior to their being imported.

The following documents must be provided for notification to the CFDA:

  • contact information for the agent and/or manufacturer of the product,
  • product name and full ingredient list,
  • national or enterprise standards applied to the product,
  • test reports,
  • safety assessment and
  • product label and other technical data, including GMP certification and evidence that the product is being sold in the country of origin.

Special cosmetics must be registered before being manufactured domestically or imported, and will require the same documentation as ordinary cosmetics with the addition of the product formulation. What remains undefined is whether existing safety assessments can be used as support in China.

Labeling

Earlier this year, as part of this regulation, the CFDA proposed the prohibition of over-labeling. This would have meant entire product labels would require printing in Chinese, forcing cosmetic companies to prepare and manage a separate inventory for China. To the non-Chinese cosmetic industry, this could lead to consumer confusion over the origin of the product because it would not necessarily look like a typical foreign product the consumer was accustomed to purchasing.

The rationale was that, under the current regulation, only the mandated information needs to be presented in Chinese—name of product, name and address of distributor/manufacturer, ingredients, etc.—and could be added to a package with an over-label. However, this also allowed English claims, depending on the label configuration, to be visible. And if the over-label were removed, it could lead to a perceived competitive advantage over domestic Chinese brands.

In the latest version of the CSAR, over-labeling is acceptable if the “sticking” process meets quality management standards for cosmetic manufacturing. The over-label must also be provided during the registration/notification process. Therefore, it seems safe to say the label will be required to be permanently affixed to the packaging and difficult to intentionally remove.

Over-labels will need to be presented in standardized Chinese characters. If the label contains other characters, they must be consistent with standardized Chinese characters. Further, the content of the labels “shall be truthful, complete and accurate.” While this is vague and will need clarification, it is good news for the industry that over-labeling is permitted under the latest draft of the CSAR.

The following data must be supplied on the over-label, in Chinese:

  • name of the product,
  • name and address of the manufacturer (brand),
  • name and address of the manufacturing company (brand or third party manufacturer),
  • manufacturing license number of the manufacturing company (except for imported cosmetics),
  • registration license number of special cosmetics or notification number of ordinary cosmetics,
  • standards codes the product conforms to,
  • full ingredients list,
  • shelf-life,
  • net weight,
  • warnings (if necessary), and
  • any other contents to comply with additional laws, regulations or requirements of the CFDA.

Claims Support

In addition to the draft cosmetic regulations, the CFDA issued a draft Administrative Management of Cosmetic Labeling, which includes a provision that claims must be validated by an independent third-party in China before they can be placed on the label. This would require companies adding efficacy or performance claims to their product’s labeling to have their claims pre-approved before submitting artwork for registration.

While the process is not yet defined, the CFDA is now requiring efficacy claims be based on “sufficient” scientific data, placing the responsibility for the claimed efficacy on the manufacturer. Scientific literature can be used to substantiate the claimed efficacy unless the CFDA deems it necessary to conduct testing; as of now, this, too, is undefined.

All relevant literature, research data or efficacy substantiation will now need to be added to the CFDA website for consumer review and acceptance—yes, the Chinese twist. With the technical nature of claims support, this could very well spell disaster. The global cosmetic industry will, without a doubt, fight this provision.

The most recent version of CSAR does show a real attempt by the Chinese government toward harmonization with the rest of the world; however, we will have to wait for the final verdict until more details emerge in the coming months.