Australia legally classifies beauty products into two categories: cosmetics and therapeutic goods. The regulations governing each category differ greatly. The difference between therapeutic goods and cosmetics is not always clear. The main factors in determining whether a product is a cosmetic or a therapeutic good are:

• its ingredients

• the route of administration

• if therapeutic claims are made on its label, or in advertising

Cosmetics in Australia are classified as industrial chemicals. “National Industrial Chemicals Notification and Assessment Scheme (NICNAS)” is responsible for managing industrial chemicals (cosmetics) and Australian Competition and Consumer Commission (ACCC) regulates the product safety and cosmetic labelling standards.

Therapeutic goods are managed by Therapeutic Goods Administration. TGA is responsible for formulating and implementing the regulations concerning registration of sponsors, advertising, labelling and manufacturing of therapeutic goods.

Part 1 Regulatory Framework and Competent Authority

1 Main Regulatory Framework

2 Competent Authority of Cosmetics

NICNAS regulates the manufacture and importation of cosmetic ingredients.

The Therapeutic Goods Administration (TGA) is responsible for administering the Therapeutic Goods and related manufacturing, labelling and advertising requirements. Goods that meet the terms of their exclusion in the new Determination are not subject to the operation of the Therapeutic Goods Act 1989.

Product safety and cosmetic labelling standards (under the mandatory standard for ingredient labelling of cosmetics) are the responsibility of the Australian Competition and Consumer Commission (ACCC).

State and Territory Government authorities regulates the use and disposal of cosmetics.

Part 2 Cosmetics

1 Definition

 A 'cosmetic' is a substance or preparation that is for use on any external part of the human body—or inside the mouth—to change its appearance, cleanse it, keep it in good condition, perfume it or protect it.

Examples of cosmetics:

Note:

• These examples are not exhaustive. Omission from the list does not necessarily mean that a product is not classified as a cosmetic.

• Click the official link to determine if your product is a cosmetic.

2 Approval Procedures of Cosmetics

Business Registration

Enterprises must register their business with NICNAS if they want to import and/or manufacture cosmetic products or cosmetic ingredients for commercial purposes (click the official link to determine if you need to register). This applies regardless of the amount that they import and/or manufacture. The registration obligations does not relate to the toxicity or hazardous nature of cosmetic ingredients.

For Foreign (non-Australian) companies, they must have an Australian Registered Body Number (ARBN) for registration. If they use an Australian distributor who is registered with NICNAS, the registration of business can be exempt.

If an enterprise needs to register, it should calculate registration level (click the official link to calculate) first, then sign up the NICNAS Business Services and register the business. The registration year runs from Sep.1st to Aug.31st the next year. Enterprises must renew the registration by 31 August each year if they continue to import and/or manufacture cosmetic products or cosmetic ingredients, otherwise they may be liable to pay a late renewal penalty—an additional 15% of the total registration cost.

AICS Checking

Nearly all cosmetic ingredients are regulated as industrial chemicals under the Industrial Chemicals (Notification and Assessment) Act 1989 (ICNA Act). This includes ingredients described as 'natural' or 'organic' such as oils, extracts and plant essences. The Australian Inventory of Chemical Substances (AICS) is a database of more than 40,000 industrial chemicals that can be manufactured or imported (introduced) into Australia. The Inventory holds chemical identity information and regulatory obligations associated with that chemical.

After business registration and before importing and/or manufacturing a cosmetic, enterprises must check if all the cosmetic ingredients of a product are listed in the AICS and complies with the conditions of usage. If yes, the product can be imported or manufactured without notifying NICNAS provided it meets any relevant conditions. If any one of the ingredients is not listed on the Inventory or has a condition of use different to the intended use, it is a new industrial chemical to Australia. Unless an exemption applies, the new industrial chemical will need to be notified and assessed by NICNAS for risks to the environment and human health before it can be imported and/or manufactured.

AICS Categories

AICS contains two categories: public AICS and confidential AICS.

There are over 40,000 chemicals listed on the public AICS which can be searched (click the official link to search the public inventory).

If there are no results in the public AICS, enterprises can make an online request with the chemical name or a CAS number for each chemical to search the confidential AICS. NICNAS will help to search the confidential AICS if they consider an enterprise/individual to have a genuine intention to manufacture and/or import a chemical. Results can be viewable online.

Exemptions

For the following 6 exemption categories, the notification can be unnecessary.

1. Research, development or analysis - Quantities cannot be more than 100kg/year

2. Transshipment - Introduced at a port or airport

3. Non-cosmetic use not exceeding 100kg - Must pose no unreasonable risk to human health and the environment

4. Cosmetic use not exceeding 100kg - Must pose no unreasonable risk to human health and the environment

5. Cosmetic use at a concentration of 1% or less - Must be non-hazardous

6. Polymers of low concern - Must meet PLC criteria

There is a special exemption example - naturally-occurring chemicals. If all the chemicals of a product are naturally-occurring, business registration and notification can be exempt. A naturally-occurring chemical is one of the following:

• an unprocessed chemical occurring in a natural environment — chemicals obtained from plants, microorganisms, the earth, sea or animals without any processing at all, for example blood and milk from animals, minerals, ores, crude oil, coal and natural gas obtained without any processing

• a chemical occurring in a natural environment that is extracted using a process that does not cause a chemical change in the substance — this refers to chemicals that occur in nature but which have been extracted using certain processes without changing their chemical composition. If introducers and suppliers extract a chemical by some other means, such as steam distillation or solvent extraction, it will not be a naturally-occurring chemical

Many products with ingredients (chemicals) derived from natural sources such as plants and minerals that are marketed or labelled as 'natural', 'organic' or 'pure' do NOT meet the legal definition of a naturally-occurring chemical. This is usually because of the process used to extract the chemical from its source before introducers and suppliers can use them in a product.

3 Notification

Once enterprises have established the necessity to notify NICNAS about the new chemical to import or manufacture (excluding a chemical introduced under exemption), they will have to determine the most appropriate notification category.

Notification Categories

Two broad categories exist for assessing a new chemical—permits and assessment certificates. Each category include several different types, shown as below:

(Click the official link to find more)

To decide which to use, the following information should be considered: type of chemical, amount you are introducing, use of the chemical, period of use and company's business needs and commitments. Enterprises may apply for an assessment certificate for chemicals that do not meet the permit criteria or where they prefer a certificate notification resulting in listing the chemical on the AICS.

Notification Requirements

All applications and information relating to notifications can be sent to NICNAS by post or courier.

Secondary notifications

A secondary notification means a chemical, which is already listed on AICS, may need to be reassessed if the circumstance under which it was originally assessed has changed including where:

• A significant change of use or new use occurs;

• A significant increase in production occurs;

• New information arises on the hazardous properties of a chemical.

To List Chemicals on AICS

4 Cosmetic Ingredients Labeling

The mandatory standard for ingredients labelling on cosmetics is prescribed by the Trade Practices (Consumer Product Information Standards) (Cosmetics) Regulations 1991. All businesses supplying goods to Australia—including online stores—must comply with mandatory standards and bans. The mandatory standard applies to the supply of all cosmetic products, except

• therapeutic goods within the meaning of the Therapeutic Goods Act 1989

• free samples of cosmetic products

• testers of a cosmetic product

• cosmetics manufactured in Australia for export only

Key Labelling Requirements

• Ensure the list of ingredients is prominent and clearly legible. List ingredients in descending order by either their mass or volume. Typically, ingredients must be listed on the product’s container. If it is not packed in a container then the ingredients should be listed on the product itself.

• Use the English name of the ingredient or its International Nomenclature Cosmetic Ingredient (INCI) names.

• The list of ingredients may include reference to colour additives that are not in the cosmetic product if the colour additive is added to some batches of the product for colour matching or used in one or more (but not all) items of a cosmetic product range. If a cosmetic product contains a colour additive that fits the above description, the list of ingredients must use either the words ‘may contain’ (or similar) followed by the name of the additive, or symbol ‘+/-’ and the name of the additive.

• The ingredients list must include any flavours in the product by including flavor, flavours, aroma or aromas.

• The ingredients list must include any fragrances in the product by including fragrance, fragrances, parfum or parfums.

• There is no need to include incidental ingredients in the ingredients list. Incidental ingredients are those that have no technical or functional effect in the cosmetic product and are only present at insignificant levels.

• The Minister may, on application, grant confidentiality status in relation to an ingredient if the Minister is satisfied that: revealing the name of the ingredient would prejudice a trade secret, and the ingredient in the product is unlikely to cause harm to the consumer. If ingredient confidentiality is granted, the ingredient can be shown as ‘other ingredient’ in the ingredient list. Exemptions granted under this provision are subject to periodic review

5 Australian Industrial Chemicals Introduction Scheme (AICIS)

On 26 May 2015, the Australian Government announced its decision to implement a range of reforms to the regulation of industrial chemicals. The AICIS is the result of a reform process to improve the regulation of industrial chemicals in Australia, which is created by the Industrial Chemical Act 2019 for the importation and manufacture of industrial chemicals in Australia (to replace NICNAS) from 1 July 2020. The main purpose of the new scheme is to help protect the Australian people and the environment by assessing the risks of industrial chemicals and providing information and recommendations to promote their safe use.

Key changes from 1 July 2020

1) The new regulatory administration will be based on the likely risk of a chemical introduction. To help achieve this:

• there will be 6 categories of introduction with different regulatory requirements that are proportionate to the likely level of risk

• this new way of categorising and introducing industrial chemicals will allow us to focus our pre-introduction assessment on higher risk chemical introductions

• there will be an increased focus on post-introduction evaluation and monitoring to help maintain the protection of health and safety of the public, workers and the environment

2) Lower risk chemical introductions will have streamlined introduction pathways, resulting in reduced regulatory burden for industry. These changes mean:

• more incentive to introduce greener, safer new industrial chemicals, including replacing more hazardous existing chemicals

• reduced costs to businesses and consumers using lower risk chemicals

• Exempted and Reported introduction categories = reductions in the time taken to introduce the chemicals to market compared to the current scheme and no notification fees

3) Higher risk chemicals — there will be improved protections for the public, workers, and the environment.

• The authority will have the ability to impose conditions of introduction on higher risk chemicals

• The authority can refuse to allow introduction of the chemical or stop its introduction if its risks to human health and the environment can't be managed — this power does not exist under the current scheme

4) Greater use of international assessment materials, including through a streamlined introduction pathway for introductions that have been assessed by a trusted international body.

5) Improved monitoring and compliance powers.

• new and increased compliance powers, with civil and criminal penalties for breaches — will help us better identify and manage non-compliance to maintain health and environmental protections

6) Improved approaches to reviewing chemicals on the market.

• replacing the current overly prescriptive post-market assessment process with a more responsive and flexible evaluation process

7) Greater transparency by striking a balance between confidentiality and publicly available information.

• publication of more meaningful information about our assessments and evaluations, with confidentiality achieved through masking the chemical name or end use

8) Restricting the use of animal test data for supporting the introduction of ingredients used in cosmetics.

• banning the use of animal test data generated after 1 July 2020 for supporting the categorisation or assessment of chemicals used solely in cosmetics

Introduction categories under the new scheme

Under the new scheme, the 6 categories of introduction are:

• Listed introductions (the chemical is listed on the Inventory and introduction is within the terms of the listing (if any))

• Exempted introductions (very low risk)

• Reported introductions (low risk)

• Assessed introductions (medium to high risk)

• Commercial evaluation introductions (for testing the market viability of the chemical before full introduction)

• Exceptional circumstances introductions (Ministerial authorisation to allow urgent introduction to protect public health or the environment).

For commercial or other reasons (for example, wanting an eventual listing of the chemical on the Inventory), introducers may apply for an assessment certificate for chemical introductions meeting Exempted or Reported criteria.

Early regulatory changes now in effect

Whilst the new scheme will begin on 1 July 2020, early regulatory changes are now in effect under the current scheme (NICNAS). These changes will reduce regulatory burden for introducers of some lower risk chemicals.

1) No annual reports for permits and self-assessed assessment certificates
Annual reports are not required to be submitted for the following permits and self-assessment certificates:

• commercial evaluation permits

• low volume permits

• controlled use permits

• self-assessment — PLCs (SAPLC)

• self-assessment — non-hazardous chemicals

• self-assessment — non-hazardous polymers.

2) Shorter time frames for Approved Foreign Scheme assessments
The time frame for assessments under the Approved Foreign Scheme category will be reduced from 90 days to 60 days. This applies to new chemical certificate applications under the current Approved Foreign Scheme categories for Limited and Standard certificates.

3) Polymers of low concern are exempt from notification
PLCs can now be introduced without notification.

4) Expansion of the PLC criteria
New criteria for PLCs are now in effect. These new criteria mean more polymers will meet the definition of a PLC and thus a greater number will be exempt from notification. The changes to the PLC criteria are:

• removal of the molecular weight specification for polyesters

• addition of chemicals to the prescribed reactants list for polyesters

• alignment of molecular weight boundaries with those used in USA

• alignment of the moderate and high concern functional groups with those used in USA and Canada

• restrictions on perfluorinated polymers so they cannot be PLCs

5) Change to synthetic polymer definition
The definition of new synthetic polymer has changed. References to 'at least 2%' in the current definition have been amended to read 'greater than 2%. This provides greater international alignment with the USA and Canada. A new synthetic polymer is now defined as a synthetic polymer:

• that includes a combination of monomers and other reactive components each representing greater than 2% by weight, being a combination not listed in the Inventory; or

• with a weight greater than 2% is attributable to a monomer or other reactive component that is not listed in the Inventory as a component of a synthetic polymer.

6) Removal of SDS and labelling requirements for exempt cosmetics

Safety Data Sheets and labels no longer have to be provided if the cosmetic is introduced under the 'no unreasonable risk' category in volumes greater than 10kg per annum.

1 Definition

The difference between therapeutic goods and cosmetics is not always clear. In general Therapeutic goods are products that prevent, diagnose or treat diseases, or that affect the structure or functions of the human body.

The main factors in determining whether a product is a cosmetic or a therapeutic good are:

• its ingredients

• the route of administration

• if therapeutic claims are made on its label, or in advertising

For example, products that produce a skin-whitening effect by colouring the skin may be regulated as cosmetics but if one that contains hydroquinone (arbutin), which inhibits the physiological process of melanin production is considered as a therapeutic good.

2 Steps to Supply Therapeutic Goods in Australia

A sponsor (i.e. the individual or company intending to supply the goods) is responsible for meeting the regulatory requirements of the therapeutic goods legislation. 'Supply' means making the product available for people to buy in Australia, including

• exporting therapeutic goods from Australia

• importing therapeutic goods into Australia

• manufacturing therapeutic goods for supply in Australia or elsewhere

• arranging for another party to import, export or manufacture therapeutic goods.

The steps below may assist a sponsor to make the initial decision about supplying a therapeutic good, and how to get started.

Step 1: Check that the product to be supplied is actually a therapeutic good

A sponsor need to confirm if the goods that are intended for supply are therapeutic goods.

• they may be classed as cosmetics in which case they are regulated under other legislation

• some goods are declared not to be therapeutic goods (excluded goods) under the Therapeutic Goods Act 1989 (the Act).

If the goods are therapeutic goods, check if an exemption applies to the goods in schedules 5, 5A or 7 of the Therapeutic Goods Regulations 1990 and check if an exemption applies to the sponsor in schedule 8 of the Therapeutic Goods Regulations 1990.

Step 2: Find out whether the product is already authorised for supply in Australia

Australian Register of Therapeutic Goods (ARTG) is a database of therapeutic goods lawfully supplied in Australia. Information held in the ARTG includes product name, formulation details, sponsor (company) and manufacturer details.

Before supply a therapeutic good the individual or enterprise shall search the ARTG for the product. If it has already been entered in the ARTG, it has already been approved by the TGA and been authorised for supply in Australia. If it is in the ARTG, and he wish to become a retail seller, he can contact the sponsor directly, but be aware that there could be commercial agreements in place that may not allow this. If the product is not in the ARTG, or if he wish to import it directly from the manufacturer and be the first point of supply, he will be the sponsor and need to get TGA approval.

Applications to list medicines in the ARTG are completed electronically online using the Electronic Listing Facility (ELF), which is part of the TGA Business Services system. In order to access TGA Business Services and ELF, they will need to complete the TGA Business Services access forms.

TGA enter therapeutic goods in the ARTG when:

• higher risk therapeutic goods have been assessed as meeting the requirements for quality, safety and-where appropriate-efficacy and/or performance; or

• lower risk medicine, biological or medical device applications have been validated.

Step 3: Determine the type of therapeutic good and the relevant regulatory guidance

Therapeutic goods includes prescription, over-the-counter and complementary medicines, and devices from lower risk items through to higher risk devices. There is a two-tiered system for the regulation of medicines, including complementary medicines:

• Higher risk medicines must be registered on the Australian Register of Therapeutic Goods (ARTG), which involves individually evaluating the quality, safety and effectiveness of the product.

• Lower risk medicines containing pre-approved, low-risk ingredients and that make limited claims can be listed on the ARTG.

Different application processes and regulatory requirements apply depending on the type of therapeutic good that is to be supplied and their associated level of risk. Sponsors are advised to review the relevant guideline document before making further enquiries to the TGA.

Step 4: Make sure the product meets the necessary legal requirements for it to be approved

There are legal requirements that apply to all therapeutic goods, such as manufacturing requirements and product and labelling standards, and there must be evidence to support the therapeutic claims made about them. There are also requirements specific to the type of product. Products will not be approved by the TGA and authorised for supply unless all the relevant legal requirements are met.

Step 5: Get up to speed with the legal responsibilities of becoming a sponsor

As well as the legal requirements that must be met before a product is approved, sponsors have ongoing legal responsibilities once their product is in the ARTG.

The range of legal responsibilities that sponsors have under the Act include:

• obtaining information from the manufacturer when requested by the TGA

• providing information to the TGA on request and within required legislative timeframes

• ensuring all manufacturers hold a relevant manufacturing licence, clearance, certification or conformity assessment certificate, as required.

• ensuring the information supplied to the TGA is complete and correct

• paying annual charges to maintain the ARTG entry while the therapeutic good is supplied

• applying to, or notifying, the TGA of any changes to the therapeutic good, if required

• complying with any conditions imposed on the supply of the goods, the requirements for advertising therapeutic goods and records of distribution and supply

• pharmacovigilance requirements (for medicines)

• notifying the TGA of adverse events or problems with the goods they sponsor

• notifying the TGA of an issue that requires corrective action, such as a recall

• undertaking recall actions relevant to the products supplied, where necessary.

Civil and criminal penalties may apply where these requirements are not met.

Further information on sponsor responsibilities under the Act is provided in the Australian Regulatory Guidelines for the respective type of therapeutic good, outlined above.

3 Advertising

The advertising of therapeutic goods in Australia is controlled through a three-tier framework:

• Regulation - Legislation administered by the TGA

• Shared regulation - Functions shared with industry

• Self-regulation - Industry Codes of Conduct/Practice

Regulation

The TGA administers the Commonwealth therapeutic goods legislation to regulate the advertising of therapeutic goods in Australia. In doing so, the TGA is responsible for ensuring advertising compliance across all therapeutic goods sectors. However, the majority of the therapeutic goods advertising legislative requirements relate to advertising to the public and there are only a select few requirements that apply to advertising to health professionals.

Shared regulation

There is one advertising-related function required under the therapeutic goods legislation that is delivered by industry organisations rather than the TGA. This function relates to a legislative requirement to have advertising for medicines that is to appear in 'specified media' pre-approved before broadcast or publication. The pre-approval services are delivered by two medicines industry organisations (we will discuss this requirement in more detail later).
However, the TGA still has overall responsibility for the administration of the legislation and oversees the pre-approval functions.

Self regulation

There are a range of industry organisations that represent various therapeutic goods sectors. These organisations generally have a code of practice or conduct that contains advertising requirements and may also contain complaint handling arrangements. As a condition of membership, members of the respective organisations are bound by their organisation's code and may be penalised for non-compliant advertising.
Industry associations are generally responsible for advertising directed to health professionals.

4 Labelling

The TGA has introduced labelling requirements for medicines supplied in Australia. Labelling requirements have been split into two new labelling Orders:

• TGO 91 - Standard for labels of prescription and related medicines (TGO91)

• TGO 92 - Standard for labels of non-prescription medicines (TGO92)

This split was applied to better consider the different risk levels for prescription and non-prescription medicines and also to improve overall readability.
Click here to see the detailed requirements for labelling and packaging.

5 Sunscreens

Primary sunscreens (products used primarily for protection from UV radiation, SPF 4 or more) and moisturisers containing sunscreen with SPF greater than 15 are regulated as therapeutic goods by the TGA. The TGA also regulates:

• all sunscreens (SPF 4 or more) that contain an insect repellent

• sunscreens with ingredients that are from humans, or particular organs from cows, sheep, goats and mule deer

Most secondary sunscreens (those with a primary purpose other than sunscreening but also contain sunscreening agents) are regulated as cosmetics, including:

• moisturisers with sunscreen with SPF up to 15

• sunbathing products (e.g. oils, creams or gels, including products for tanning without sun and after sun care products) with SPF between 4 and 15

• make-up products with any SPF

• lip-sticks and lip balms with sunscreen with any SPF

When sponsors want to supply a sunscreen product in Australia they must comply with the information in the Australian Regulatory Guidelines for Sunscreens. These guidelines contain information on:

• listing of therapeutic sunscreens

• registration of therapeutic sunscreens

• sunscreens which are exempt from regulation by the TGA

• responsibility of sponsors to report adverse reactions

• labelling (including a labelling checklist)

• advertisements for therapeutic sunscreens

• reproducibility of SPF test results

• stability testing

• manufacture and quality control

• permitted ingredients

• new ingredients

Sunscreens must comply with the Australian and New Zealand Sunscreen Standard AS/NZS 2604 Sunscreen products - Evaluation and classification in force at the time of listing on the ARTG.

(Click the official link to learn more.)