ICRL 2|2020 Reports 73 Status of Cosmetics Regulations in Korea Doris Peters and Jae-Seong Choi* I. The Cosmetic Market in South Korea products and raw materials are legislated and man- aged by the Ministry of Food and Drug Safety South Korea ranks amongst the top ten cosmetics (“MFDS”). The new law was adopted to improve the markets in the world and represents about 2.8 per- competitiveness of the domestic cosmetic industry cent of the global market1. Korea is considered as and to keep pace with international regulatory global center of innovations in cosmetics – “K-Beau- trends. The Cosmetics Act has gone through various ty” is on the rise. South Korean products impress changes, such as subdividing related regulations, through their effectiveness, packaging and sensory adopting Cosmetics Good Manufacturing Practice appeal and by thus, inspire Western brands. Cos- (cGMP) standards for cosmetics and preparing certi- metics in South Korea are defined as products ap- fication standards for Natural and Organic Cosmet- plied or sprayed onto the human body in order to ics. clean, beautify, change, brighten, maintain or pro- The legislative text mainly outlines the legal oblig- mote the health of skin and hair. The South Korean ations specifically for importers of cosmetics to help Cosmetic market is valued about 10bn USD today non-Korean manufacturers exporting their products with an estimated CAGR of 4.95% during to South Korea. The obligations depend on the type 2017-20302. and category of the cosmetic product. Inordertocontributetoimprovingnationalhealth and developing the cosmetics industry, the South Ko- rean government issued the overarching regulation 1. Categories of cosmetic products for cosmetics known as the Cosmetics Act3 (Act No. 17250) in 2000. The legislation provides measures for According to the Cosmetics Act, cosmetic products the manufacture, import and sale of cosmet- are categorized into “functional cosmetics” and “gen- ics and cosmetic ingredients including detailed re- eral cosmetics”. Unlike “general cosmetics”, where quirements for the labeling and advertising of prod- manufacturers or importers are permitted to mar- ucts and has lately been revised in April 2020. ket their products without registration but are sub- ject to post-market monitoring, for products corre- sponding to the “functional cosmetics” it is obliga- II. The Cosmetics Legislation before tory to undergo a registration process related to their April 2020 safety, efficacy and function by the MFDS before market launch. Further, functional cosmetics are Cosmetics were managed as a part of the Pharmaceu- subdivided into categories depending on the pur- tical Affairs Act before the Cosmetics Act was intro- pose of use, such as infants, baths, fragrances, wash- duced in 2000. Since then, regulations on cosmetic ing and dyeing; accordingly the requirements are different. Functional cosmetics should not be confused with consumer goods such as quasi-drugs (e.g. sanitary DOI: 10.21552/icrl/2020/2/8 napkins, hand sanitizer, antiseptics, toothpaste and * Doris Peters is Managing Director at Consortia Management GmbH. For Correspondence: e-Mail: <peters@consortia-manage- mouth refreshers, etc.) which are controlled under ment.com>. Jae-Seong Choi is Branch Manager at Chemservice the Pharmaceutical Affairs Act and are subject to dif- Asia, For Correspondence: <[email protected]> ferent registration obligations. Importers should stay 1 See, International Trade Adminstration <https://www.trade.gov/> accessed Oct 24, 2020 updated for the latest regulations and categorization 2 See, Goldstein Research <https://www.goldsteinresearch.com/re- on consumer goods and functional cosmetics in place port/korean-cosmetics-market-report-south-korea-industry-analy- prior to imports to comply with the current applica- sis> accessed Oct 24, 2020 ble law in South Korea and avoid unnecessary ac- 3 Cosmetics Act (Act No. 17250, revision enforced on 7th April 2020 by MFDS) tions. 74 Reports ICRL 2|2020 Table 1: Categories of Functional Cosmetics Application area Categories Remarks Skin Skin whitening by preventing or fading melanin pig- mentation Anti-wrinkle Tanning UV protecting Alleviating acne Rinse-off only Alleviating atopic skin Stretch mark thinning Hair Dyeing (incl. bleaching) excl. temporary hair dyes Hair removing excl. physical hair removing Alleviating alopecia excl. physical hair thickening (i.e. coat- ing) Powered by TCPDF (www.tcpdf.org) www.lexxion.eu 2. Legal requirements of importing a. Import procedure cosmetics Figure 1 below demonstrates the overall procedure Overall, the legal obligations to manufacture, import, of importing functional cosmetics under the Cosmet- distribute or sell cosmetic products have been sim- ics Act from business registration to labelling and plified since the Cosmetics Act has been firstly estab- market distribution. lished in order to secure the market fluidity and com- petitiveness. However, authorities have increased b. Business registration safety examinations of products and raw materials to the benefit of the public health. The responsibili- Any person or enterprise who intends to manufac- ties on quality management and safety communica- ture, import or sell cosmetics in Korea should regis- tion need to be strictly followed by each authorized ter a cosmetic business first, differentiating between actor in the supply chain. For example, importers the following: should conduct product quality self-inspection of im- • Manufacturing business ported cosmetics and must not put any products con- • Responsible cosmetic distribution business taining any prohibited ingredients on the Korean • Custom cosmetics sales business market. In case of any violation observed, MFDS is able to recall the products by a public announcement When importing cosmetics, the importer should be with immediate effect, which would seriously impact registered as the “responsible cosmetic distributor” the future business and reputation of not only the (the so called “Marketing Authorization Holder domestic distributor, but also of the manufacturer (MAH)”) who observes the duties on importing cos- himself. metics under the Cosmetics Act. It is important to verify that the importer is properly authorized ac- ICRL 2|2020 Reports 75 d. Customs clearance After approval of the registration of the functional cosmetics, customs clearance is required after the physical import of the product into Korea. The im- port notification should be submitted to KPTA5 to initiate a customs clearance procedure with the fol- lowing requirements: – Standard customs clearance report (submitted by importer in EDI6 format) Figure 1: Import Process of Functional Cosmetics in – Certificate of Manufacturing Korea – TSE7 (and/or BSE8) related documents An approval letter of the product registration from MFDS is additionally required to process the func- tional cosmetic. After customs clearance, generally cording to the business registration. The non-Kore- the products are stored in a warehouse until the qual- an manufacturer needs to provide the required doc- ity inspection is completed and the approval letter is umentation to the importer to comply with the oblig- issued. ations when importing cosmetic products under the The overall process of customs clearance for raw Korean law. materials is similar to finished products. When a sin- gle raw material is imported, the INCI9 name replaces c. Registration of Functional Cosmetics the product name in the documentation. For bulk- mixtures (mix of different raw materials), it is suffi- As described in Chapter II.1., functional cosmetics cient to file one report for the mixture. The ICNI are subject to a product registration by MFDS to get name of each ingredient should be indicated at the an approval letter before manufacturing or import- product name sector and the Harmonized System ing into Korea. The dossiers are evaluated to prove Code (HS Code) of its derived finished cosmetic prod- the safety and efficacy and to verify the quality man- uct should apply instead of the raw materials code. agement according to the testing standards specified Raw materials, including bulk-mixtures, do not re- in KFCC4 (Korean Functional Cosmetics Codex). Reg- quire a business registration as importer under the istration dossiers have to be submitted in Korean lan- Cosmetics Act in Korea. Any company can import guage. raw materials and resell it to registered manufactur- Some of the dossier requirements can be exempt- ers, after the self-inspection on raw material has been ed under designated conditions as specified in An- conducted. nex 4 of the “Standard of Functional Cosmetics Eval- uation (MFDS public notification No. 2019-47)”, e.g. e. Product quality inspection origin and development background information and clinical and efficacy study data are exempted Testing methods or frequency of the product quality when a functional product contains only ingredients inspection is not mandated under the Cosmetics Act, listed already in this standard. but the importer, as MAH, needs to conduct a self-in- spection of the product ensuring the characteristics fulfil the safety standard obligation of the Cosmetics 4 Korean Functional Cosmetics Codex (MFDS public notice No. Act respecting the negative list of ingredients and cri- 2018-111) teria of the testing values. For functional cosmetics, 5 Korea Pharmaceutical Traders Association <http://www.kp- ta.or.kr/eng/main/main.asp>, accessed October 24 2020 different testing parameters have to be verified