[Updated] China Further Refines the Requirements for Enterprises to Perform the Entity Responsibility for Cosmetic Quality and Safety

Editor's Note: This article was originally published on December 8, 2022, and was firstly updated on January 3, 2023 and secondly on March 9, 2023, as per the latest developments.

In November 2022, China National Medical Products Administration (NMPA) launched a public consultation on the draft of Regulations on Supervision and Administration of Enterprises in Implementing Entity Responsibility for Cosmetic Quality and Safety (the Regulations). One month later, on December 29, 2022, NMPA released the finalized Regulations¹, which has taken effect since March 1, 2023.

Highlights of the Regulations

1. Specifying the responsibility entities of cosmetic's quality and safety

Enterprises shall develop a responsibility system for cosmetic quality and safety, and clarify the duties of relevant positions. As outlined by the draft, the responsibility entities of cosmetic's quality and safety include:

Cosmetic registrants and notifiers who are engaged in cosmetic's production: they shall be responsible for the quality and safety, and the efficacy claims of cosmetics. They are also required to manage the quality and safety of their registered and notified cosmetics in the whole production cycle from the initial research and development to operation.
Cosmetic registrants and notifiers who entrust production enterprises to produce cosmetics: they shall supervise the whole production process, and be responsible for the quality and safety of the cosmetics entrusted for production;
Entrusted production enterprises: they shall be responsible for the production activities, and accept the supervision of the entrusting companies.

In addition to the responsibility entities mentioned above, the finalized Regulations supplements that, the Chinese domestic responsible persons designated by overseas cosmetic registrants and notifiers shall undertake corresponding responsibilities for cosmetic's quality and safety, and cooperate with the supervision and inspection work of medical products administration departments.

Cosmetic operators are also encouraged to establish a responsibility system with reference to the Regulations, and assign specific persons to take responsibilities for cosmetic quality and safety issues, such as purchase inspection and recording, adverse reaction reporting, product recall cooperation, etc.

2. Emphasizing the duties of key positions, especially the person in charge of quality and safety

Under the responsibility system, the enterprise's legal representative (or the person chiefly in charge, the same below), and the person in charge of quality and safety (the person) shall take up the key positions related to cosmetic quality and safety. The former shall bear the full responsibility for cosmetic quality and safety, while the latter shall assist in organizing and leading the personnel from relevant positions to perform corresponding duties in accordance with laws.

Key Position		Duties	Notes
Enterprise's legal representative		(1) Undertaking comprehensive management of cosmetic's quality and safety, as well as bearing the responsibilities for providing necessary resources, formulating and implementing reasonable quality policies, and ensuring the realization of quality goals; (2) Ensuring the person to carry out the cosmetic quality and safety management in accordance with laws, as well as urging quality and safety-related departments to cooperate with the person. a. providing necessary conditions for the person to learn and receive training; b. providing necessary working conditions and position treatment for the person, and establishing a corresponding incentive mechanism.	The legal representative can entrust other personnel of the enterprise to undertake the comprehensive management of cosmetic's quality and safety on his/her behalf.
The person in charge of quality and safety	assigned by the enterprise engaged in cosmetic's production	(1) Establishing and organizing the implementation of the enterprise's quality management system, fulfilling the quality and safety management responsibilities, and regularly reporting the system's operation to the legal representative; (2) Making decisions on product quality and safety issues, and issuing relevant documents; (3) Reviewing product safety assessment reports, formulas, production techniques, material suppliers, product labels, etc., as well as cosmetic registration and notification documents, and the annual report of general cosmetics； (4) Managing material release and product release; (5) Managing cosmetics adverse reaction monitoring.	With the written consent of the legal representative, the person can designate other personnel of the enterprise to assist him/her in performing the duties.
	assigned by the enterprise who entrusts production enterprises to produce cosmetics	(1) Establishing and organizing the implementation of the enterprise's quality management system, fulfilling the quality and safety management responsibilities, and regularly reporting the system's operation to the legal representative; (2) Making decisions on product quality and safety issues, and issuing relevant documents; (3) Reviewing cosmetic registration and notification documents, as well as the annual report of general cosmetics; (4) Reviewing material suppliers and material release in the situation where the entrusting enterprises purchase and provide materials; (5) Releasing products to the market; (6) Supervising and managing the selection of entrusted enterprises and production activities; (7) Managing cosmetics adverse reaction monitoring.

To continuously improve their ability to perform duties, the persons are required to spend at least 40 class hours in relevant learning and training every year. Enterprises shall conduct regular assessment of the person's qualification and performance. If the assessment result shows that the person fails to fulfil the duties as prescribed, or his/her capacity fails to meet the qualification requirements, the person will be ordered to make corrections, or even be changed.

3. Clarifying the scope of personnel subject to penalties when certain misconduct happens, and the situations where penalties can be mitigated or exempted

If the enterprise fails to assign a person in charge of quality and safety or fails to perform the entity responsibility, or the person assigned does not meet the qualification requirements or lacks corresponding ability to perform their duties, the medical products administration department shall impose punishment in accordance with Cosmetic Supervision and Administration Regulation (CSAR). CSAR stipulates the personnel subject to punishment when an illegal act is found, including the legal representative, the person directly in charge, and other directly responsible individuals. On this basis, the Regulations supplements the scope of personnel considered as the person directly in charge, and other directly responsible individuals.

The person directly in charge	The persons bear direct management responsibility in illegal acts, including but are not limited to: a. the personnel entrusted by the legal representative to fulfil the duties of comprehensive management of cosmetic quality and safety on his/her behalf; b. the person in charge of quality and safety
Other directly responsible individuals	The persons who have carried out the specific illegal acts, and played a major role, including but are not limited to: a. the personnel in charge of cosmetic quality and safety-related departments, such as quality management department and production department; b. the personnel designated to assist the person responsible for quality and safety in carrying out his/her duties

In addition, the Regulations describes the situations where the punishment can be mitigated or exempted:

where there is solid evidence to prove that the relevant responsible persons of the enterprise have fulfilled the obligations of cosmetic quality and safety, and have no subjective fault, no administrative punishment shall be imposed on them;
where the relevant responsible persons of the enterprise voluntarily confess the illegal acts of the cosmetic manufacturers or operators which are not known to the medical products administration departments, or have meritorious performance by cooperating with the medical products administration departments in investigating and dealing with the illegal acts of cosmetic producers or operators, a reduced or mitigated administrative penalty shall be imposed on them.