Avoiding China Cosmetic Animal Testing Requirements: Tips for Industry

Takehome: To avoid animal testing requirements international cosmetics companies can consider:

1) Setting up a manufacturing facility in China to manufacture non-special use cosmetics

2) Consider using CBEC, although the regulatory landscape in this sector is changing fast. In the next couple of years we can expect standard regulatory requirements to be the same as crossborder ecommerce.

3) Consider exporting raw materials or semi-finished products in bulk for repackaging in China.

4) There is some light at the end of the tunnel for cruelty free cosmetic companies as China recently approved an alternative to animal testing (see CL news).

The Rub for Cruelty Free Companies: China’s Animal Testing Requirements

In China, all cosmetics (excluding domestic non-special use cosmetics) must undergo animal testing to obtain a toxicology test report which is a mandatory requirement when compiling registration dossiers used during application for pre-market approval from CFDA. For domestic non-special use cosmetics, animal testing can be avoided if the product/ingredient has been shown to be safe through safety assessment.

These regulatory requirements have meant that many ethically orientated cosmetic brands have decided not to consider China as a viable market. Non-animal testing status is a major selling point for many brands which cannot risk alienating key consumer sectors by any association with a market where animal testing is mandatory. Interestingly China’s association with animal testing is the reason The Body Shop left airport duty-free shops in China despite the fact that goods in duty-free shops don’t require pre-market approval and generally do not require animal testing. In consideration of brand positioning, many brands also refuse to label their products as "made in China".

Establishing Mainland Manufacturing Facilities

Manufacturing non-special use cosmetics in China is an option to avoid animal testing many brands still avoid this option based on China’s poor reputation. Some brands do still setup factories in China and conduct safety assessment for the purpose of both avoiding animal testing and selling into China’s large market. From the perspective of Chinese consumers as long as a brand and its product have a good reputation, history of safe usage and efficacy, consumers will purchase it, the “made in China” designation is not a significant factor in purchasing decisions.

Repackaging Goods

In addition to setting up a factory in China, foreign brands also repack cosmetics in China to avoid animal testing. Under Chinese regulation if the final manufacturing/processing step is completed in China, these cosmetics are defined as domestic cosmetics. Another advantage of repacking is that companies can still claim that the product is imported (just containers and packaging are domestic). Therefore, more companies prefer repacking cosmetics. However, recently there is news that China will ban repacking and some provinces have already implemented the ban. The CFDA has still not released an official document confirming this ban so companies can still use this method after confirming regional requirements.

Crossborder Ecommerce

CBEC is an exceedingly popular and profitable method to enter China’s market which has gained significant market share in the recent two years. Given the relatively reduced market entry time and financial investment requirements associated with this method and the added advantage of avoiding animal testing, many SMEs have used this method. CBEC cosmetics don’t require registration/filing with CFDA and also don’t require Chinese labels and packaging. Significant time and financial investment associated with standard pre-market approval along with the necessity to produce Chinese labels and toxicology test reports can all be avoided using CBEC. Unfortunately, early this year, China stipulated that CBEC cosmetics will require registration/filing in the future. This new policy will enter into effect from 2018.

China’s Cruelty Free Future

Four and a half years after CFDA consulted on “In Vitro 3T3 NRU Phototoxicity Test for Chemicals in Cosmetics”, on Nov 11 2016 CFDA finally accepted the alternative to animal testing of cosmetics ingredients. The test applies to the assessment of the potential phototoxicity of chemicals in cosmetics especially chemicals with ultraviolet absorption. It is a historic breakthrough for China on the way to realizing a cruelty free cosmetic sector. It is estimated that China may not implement a total ban on animal testing like what was done in the EU, but will instead adopt an approach of encouraging the use of alternatives. However, considering the time taken from initial public consultation until implementation, it could be a long time until China approves enough alternatives to fully replace all kinds of animal testing.