Page 63 - Export Magazine

REPOR T

The United States has, very recently, changed its regulatory “clean,” “nontoxic,” or “safe.” Nor does it provide guidance on
requirements for cosmetic brands. On December 29, how much support brands need to make certain claims, such as
2022, President Biden signed into law the Consolidated scientific studies, customer surveys, or third-party certifications.
Appropriations Act, 2023, which includes the Modernization These are growing areas of scrutiny for the class action plaintiffs’
of Cosmetics Regulation Act of 2022 (MoCRA). MoCRA bar, yet MoCRA does not provide any additional guidance on
significantly changes the current regulatory framework for what kinds of claims companies can make about the safety or
cosmetics in place. Under MoCRA, cosmetic companies will be purity of their products. Instead, companies will have to look to
subject to facility registration and product listing requirements, guidance from FTC, in the form of reported enforcement actions
good manufacturing practices (GMPs), serious adverse event and prospective revisions to FTC’s “Green Guides,” as well as
reporting and recordkeeping, and safety substantiation. In federal court decisions, to provide guidance on cosmetic claims.
addition to these new obligations, the FDA has now been Finally, MoCRA doesn’t address so-called “greenwashing” or
granted mandatory recall authority if it determines that: 1) environmental impact claims, which have been the focus of
there is a reasonable probability that cosmetics are adulterated recent legislative action in the United Kingdom and the EU.
or misbranded under the FDCA; and 2) exposure will cause MoCRA fails to address whether and under what conditions
serious adverse health consequences. The FDA also may a product can claim to be environmentally friendly, green, or
suspend a facility’s registration. zero-pollution in its marketing. Yet, the door is open to having
these areas come under legislation as well.

A brand must consider all
of these challenges and more.

A designated “Responsible Person” (not a person, but an Driven in part by the recent pandemic and by the preferences
entity: manufacturer, packager or distributor) is required by of Gen Z, trends have pushed beauty brands, regardless of
the FDA. A brand has to allocate staff and funds towards due category, towards a product offer that is personalized, organic,
diligence in matters of compliance, as well as remain on top good for the planet and emphasizes wellness. In 2022, the
of further regulatory changes. Efforts towards compliance, organic cosmetics market was anticipated to be worth US$19.6
according to many legal counsels, must include both funds for billion. The market is expected to increase by 5.1% CAGR from
testing products provided by 3rdp party suppliers, and clear, US$20.5 billion in 2023 to US$33.7 billion in 2033. And the
consistent guidelines to influencers about what can and can skincare segment posts the strongest growth in the category.
not be said on social media. Close to 70% of US consumers are now looking for brands
that highlight “clean” ingredients,
associated with naturally- derived
“the main investment [required by brands ingredients & environmentally-
in regards to Mocra] will be in people and friendly formulations. Black
recording systems for product listings and consumers are reportedly
registration maintenance, as well as technology 36% more likely to buy clean
to support better hygiene in the manufacturing beauty than their consumer
process overall. this will drive the lion’s share counterparts. Per NielsenIQ data,
of capital investment.” cruelty-free beauty gained eight
- Geoff Waby, Former Estée Lauder Quality Assurance Executive points of household penetration
in 2021. In addition, fair trade
beauty spending was up 7.5%.
Although MoCRA represents a significant shift in the way the Per NielsenIQ, spending on
federal government regulates the cosmetics industry, MoCRA gluten-free beauty grew by $8
falls short of previous legislative proposals, which would have per household in 2021 and 57%
authorized FDA to conduct annual investigations into the safety of American women say it is
of ingredients or, in certain cases, restrict or prohibit the use important for them to use natural
of ingredients like Per- and polyfluoroalkyl substances (PFAS), products. Indeed, the natural
also known as, endocrine disruptors. It does, however, require products segment recorded
the FDA to issue a report within three years assessing the use fast growth in the last 5 years. Locally made products, with or
of PFAS in cosmetics and their safety, signaling the possibility without locally grown ingredients, emerge top-sellers. Scalp
of further legislation or regulation, if warranted. care and products to support the various stages of a woman’s
MoCRA also does not address or alter the existing regulatory life, as well as inner beauty focused supplements, powders, and
framework for cosmetic labeling and marketing issues, such ingestibles are emerging as categories sought out by buyers,
as defining or restricting the use of certain terms like “natural,” in both retail and spa.

61
61 www.exportmagazine.net www.exportmagazine.net