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Packaging & Labelling of Cosmetic & Personal Care.

Date: 29th October 2012

Australian Society of Cosmetic Chemists

Position Paper

Guide to Packaging and Labelling of Cosmetic and Personal Care Products in Australia

Author: John O'Donnell July 2012

Supercedes: Packaging of Cosmetics and Toiletries position paper published in 1998.

Position

The Australian Society of Cosmetic Chemists supports the principle of standardisation where appropriate, to protect the consumer from deceptive practices and misleading labels and reduction in the environmental impact of packaging. Furthermore, the ASCC supports international harmonisation and elimination of unique Australian regulations. However, in working towards this end it is essential that industry is allowed to participate in the development of regulations. Without industry input, government committees are often unaware of the impact that their decisions may have on business.

Scope

Cosmetics, toiletries and personal care products are the basis of this paper and will be referred to by the generic term “cosmetics”. A cosmetic as defined by the Australian Competition and Consumer Commission is: „Cosmetic and toiletry products are substances or preparations intended for placement in contact with any external part of the body, including the mouth and the teeth, with a view to:

 altering the odours of the body; or

 changing its appearance; or

 cleansing it; or

 maintaining it in good condition; or

 perfuming it; or

 protecting it.‟

(Source: Cosmetic and Toiletry Ingredient Labelling Regulation, December 2000)

This paper will not address other products such as Therapeutic, Agricultural, Veterinary or Household products.

Every effort has been made to ensure the accuracy and currency of the information provided. However, it is important that anyone using this document carefully check local regulatory requirements and refer to the regulations or seek expert advice to ensure compliance.

Introduction

The first ASCC Position Paper Packaging of Cosmetics and Toiletries was published in April, 1998. Since that time there have been many significant changes in the legislative requirements as well as the increasing popularity of environmental and natural claims for cosmetic products. The National Packaging Covenant was introduced in 2000. In July 2010, a new action plan was introduced which will remain in force until June 2015. A national system of quantity marking has also been adopted and came into force on July 1, 2010.

There are many factors that need to be considered when designing and finally marketing a cosmetic product. The requirements fall into 3 categories:

 Regulatory: information required on labels and deceptive packaging

 Compatibility: of packaging with the product

 Environmental: legislative requirements to reduce the impact of packaging.

All documents referred to in this paper are included in the reference section. Many are available via the internet and the website address is included where available.

Regulatory

Australia is a federation of six states, with 2 territories and national government. This gives rise to a total of 9 jurisdictions which can pass laws which effect marketing and sale of cosmetics. Fortunately, there has been significant progress to harmonise legislative requirements, but there may still be specific state or territory requirements which differ from other jurisdictions.

The main legislative requirements are administered by different government agencies:

Standard for the Uniform Scheduling of Medicines and Poisons (SUSMP)

Formerly, the Standard for Uniform Scheduling of Drugs and Poisons, the new Poison Standard was introduced in 2011. The SUSMP contains legal requirements for the labelling of poisons and drugs that are available for sale to the public. It is a positive list, so if an ingredient is not listed in the SUSMP then it is not classified as a drug or poison. Classification is on an ingredient basis, and a single ingredient may have a number of classifications. The classifications are divided into eight (8) schedules, in order from most to least restrictive:

Schedule 8: Drugs of dependence requiring a special licence.

Schedule 4: Prescription drugs.

Schedule 7: Dangerous poisons requiring special precautions – only available to authorised users.

Schedule 3: Pharmacist Only Medicine - Over the Counter Drugs requiring dispensing by a pharmacist.

Schedule 2: Pharmacy Only Medicine – Over the Counter Drugs only available from pharmacies.

Schedule 6: Poison – Substances with a moderate potential for causing harm, the extent of which can be reduced through the use of distinctive packaging with strong warnings and safety directions on the label.

Schedule 5: Caution – Substances with a low potential for causing harm, the extent
of which can be reduced through the use of appropriate packaging with
simple warnings and safety directions on the label.

Schedule 1: No longer exists.

Cosmetics do not generally fall within the SUSMP, but some products, such as perm solutions, could fall under Schedules 5 or 6. Any product with ingredients that fall in the definition of Schedules 8, 4, 3 and 2 are therapeutic and outside the scope of this paper. Schedule 7 are dangerous poisons available only to authorized users and so are not applicable to cosmetics.

There are three elements to determine whether or not a product is a poison:

 One or more ingredients are listed in the SUSMP

 The ingredients are present in the finished product within the concentration range specified in the SUSMP

 If particular label statements are used, the finished product will not be a poison even if it contains an ingredient listed in the SUSMP.

Determining whether or not a product is classified as a poison or a drug is by reviewing all the ingredients in the formula and then checking if any ingredients are listed in the SUSMP. If an ingredient is listed, then the conditions under which it is listed must be checked.

For example, Triethanolamine is a Schedule 5 poison when 5% or more is present. A product containing 8% triethanolamine would be a Schedule 5 poison but a product with 3% triethanolamine would not. The actual listing in the SUSMP applies to triethanolamine alone and not its salts or derivatives.


The same ingredient can occur in multiple schedules. Consider hydrogen peroxide:

Schedule 5 Monograph:

HYDROGEN PEROXIDE (excluding its salts and derivatives):

(a) in hair dye preparations containing 12 per cent or less of hydrogen peroxide

except in hair dyes containing 6 per cent or less of hydrogen peroxide; or

(b) in other preparations containing 6 per cent (20 volume) or less of hydrogen

peroxide except in preparations containing 3 per cent

(10 volume) or less of hydrogen peroxide.

Schedule 6 Monograph:

HYDROGEN PEROXIDE (excluding its salts and derivatives) except:

(a) when included in Schedule 5;

(b) in hair dye preparations containing 6 per cent (20 volume) or less of hydrogen

peroxide; or

(c) in other preparations containing 3 per cent (10 volume) or less of

hydrogen peroxide.

A level of skill is required to correctly interpret the SUSMP monographs and those without experience should seek additional expertise to ensure correct interpretation has been made.

Some further examples are listed in Appendix A.

Once a product has been classified as a poison, it must comply with the requirements of the SUSMP which cover:

 Packaging – design, child resistant closures

 Labelling – signal words, warning statements, first aid instructions

These requirements can be found in the SUSMP as well as the Guide to Labelling of Drugs and Poisons.

The SUSMP is under ongoing review. A new edition is published each year along with quarterly updates. A subscription service is available to ensure that you have the current version available.

Cosmetic versus Therapeutic Claims

Primarily the distinction between a cosmetic and drug is on the basis of ingredients in the formula. A product which contains codeine will always be a pharmaceutical. Claims made for a product can also result in a product being therapeutic rather than cosmetic, irrespective of the ingredients.

If a product was to claim that it “smooths the appearance of wrinkles” this would be cosmetic but if the claim was „eliminates wrinkles‟ then this would not be an allowed cosmetic claim. Cosmetic claims should be carefully considered to ensure that therapeutic claims are not being made. Guidance on acceptable claims can be found on the TGA website.


Cosmetic Ingredient Labelling

Ingredient labelling was introduced in 1991 and the last amendment was in 2008. The Australian Competition and Consumer Commission (ACCC) is responsible for this legislation. The basic requirement is for all ingredients to be listed on the product label in descending order of concentration. Ingredient names should use International Nomenclature of Cosmetic Ingredient system of defining names for Cosmetic Ingredients or their English name. Thus, for botanical extracts the INCI or common English name can be used. Thus Tea Tree Oil or Melaleuca Oil would be acceptable.

The regulation can be found at: http://www.comlaw.gov.au/Details/F2008C00244

Alternative naming systems are not permitted although provision of additional information is allowed. For example, naming an ingredient as “coconut derived surfactant” on its own does not comply with the requirements, however listing the ingredient as sodium cocoate (coconut derived surfactant) would be acceptable.

The purpose of ingredient labelling is to provide public information of all the chemicals included in a product. Inaccurate or non-specific ingredient identification may be deceptive and lead to action from the ACCC. There are regular successful actions by the ACCC and an example is:

In particular, until on or about 30 June 2008: A company:
 did not include sodium laureth sulphate (plant derived), cocamide DEA, cetrimonium chloride and citric acid as ingredients on the labels of some of its products, as required by the Trade Practices (Consumer Product Information Standards) (Cosmetic) Regulations 1991 (the Standard).
 did not list ingredients in the order required by the Standard.
 did not correctly name certain chemicals and ingredients, as required by the Standard.
 The ACCC also expressed concern that statements by the company that its products are “made with/from 100% pure oils and certified organic herbs” may be misleading or deceptive because they imply that the products contain significant amounts of herbs and oils, when certain products only contain 0.2% to 0.6% of herbs and oils. This is typical of the actions taken by the ACCC.

Country of Origin Labelling

There are 2 aspects of Country of Origin labelling. The first and most important is to include on the label the country in which the product was made. It should be noted that Europe or the EU is not a country and the individual country must be listed.

If the product is manufactured and filled in a single country then it is quite simple to identify the country of origin.

Complexity occurs when the bulk product is manufactured in one country, shipped to a second country for filling and then repacked in Australia, to comply with local regulations. In this case, the basis for deciding the country of origin is to determine where substantial transformation takes place. Calculating the total cost of goods can be useful and the country in which 50% or more of the cost is incurred is the country of origin.

At all times you must not be deceptive in portraying the country of origin. The ACCC website has a fact sheet which provides a very useful guide.

The other aspect of Country of Origin is “Australian Made”. Use of the Australian Made logo is owned by the Australian Made Australian Grown not-for-profit organisation. There are strict criteria which must be met to be able to use their logos and further information can be found at:

http://www.australianmade.com.au/businesses/

Products can still claim Australian Made and use logos to indicate this, provided that the Australian content is substantial, >50% of cost, and that a particular logo is not deceptive nor does it breach another organizations copyright.

Deceptive Packaging

Deceptive packaging is packaging which is designed to make a pack appear to hold more content that it actually does. An example would be to have 100mLs of product filled into a bottle which has an actual capacity of 1000mLs.

A code of Practice was developed and adopted by all jurisdictions in 1987 and, while not a regulation all parties agreed that:

“PACKAGES MEETING THE REQUIREMENTS OF THE CODE WILL NOT BE
CONSIDERED DECEPTIVE BY STATE AND TERRITORY AUTHORITIES. IF THE PACKAGING DOES NOT COMPLY WITH THE REQUIREMENTS, THE ONUS WILL BE ON THE PACKER (OR SUPPLIER) TO SHOW THAT THE PACKAGES CONCERNED ARE NOT DECEPTIVELY PACKAGED.”

The requirements of the Code cover features of packaging that are likely to deceive consumers. These are:

 Free space or ullage. Maximum permitted is 25%

 Recesses – the aggregate volume of recesses is 10% maximum

 Cavities – aggregate volume of cavities must not exceed 15%

The code provides full information on definitions, exceptions and methods of calculation and determination of free space, recesses and cavities.

Quantity Marking

All products must indicate the quantity, volume, mass or number, contained within the pack. A National standard for quantity marking was implemented in 2010. This introduced an additional method of determining fill quantity accuracy, so that there are now 2 acceptable systems for determining if there is a shortfall in a package.

UTML system: A deficiency from the quantity stated on the label should not exceed more than 5% in any one package. There can be no average deficiency from the quantity stated on the label within a sample of randomly selected packages.

“Average Quantity System (AQS) is a method based on internationally set statistical sampling techniques. AQS uses the measure of the average quantity, together with the scatter around the average, of a sample of pre-packaged articles in order to gauge regulatory compliance. It is a method that largely applies to sizeable production runs. AQS was introduced, with wide support from industry, as part of the amendments to the National Measurement Act 1960. AQS brings Australia in line with international packaging practice and puts Australian businesses on an equal footing with international competitors. A key advantage of the AQS is that it may allow businesses to avoid „over-filling‟.”

From 1 July 2010, industry will be able to choose to comply with AQS standards or the existing UTML standards. A guide can be downloaded from:

http://www.measurement.gov.au/Publications/trademeasurement/Documents/Guide%20to%20the%20Average%20Quantity%20System.pdf

Deceptive Labelling

Product labels and the claims made for products must be carefully considered to ensure consumers are not deceived or mislead. Any claims must be supported by verifiable test protocols. Cosmetics have to be careful to not make Therapeutic claims or deceptive claims.

Deceptive claims are investigated by the ACCC and their website lists a number of successful prosecutions against Cosmetic companies. In addition to non-disclosure of ingredients, a common deceptive practice is to make claims for particular ingredients but only using very low levels so that the actual concentration in the product is inconsequential or much less than the label infers. Natural and Organic claims are becoming popular and these must be able to be supported. There is an Australian Standard which covers Organic Cosmetics and compliance with this standard will allow a claim that a product is Organic. However, there are no Australian Standards defining Natural cosmetics.

Compliance with Australian Standards, provided there are no claims outside the scope of the standard, provides a sound basis for supporting claims, However, compliance with private standards offers no legal defence against false and misleading claims. No recognised Australian Standards exist for Natural cosmetics, but there are a number of private standards and logos which can be used. These private standards are not recognised and so all product claims, even if compliant with the private standard, would have to be defended if challenged by the ACCC.

Dangerous Goods

Some cosmetics such as aerosols and nail varnish, are classified as dangerous goods. Classification of a product as a dangerous good is based on the chemical composition of the final formulation and has an impact on packaging design and labelling. There is also an impact on storage and transport. The requirements are detailed in the Australian Code for Transport of Dangerous Goods and number of Australian Standards which deal with dangerous goods in general as well as specific classes.

Hazardous Substances

Hazardous substances are concerned with use and storage of substances in the workplace. Suppliers must provide a material safety data sheet (MSDS) in all cases. For products to be used in the workplace there are additional labelling requirements.

Packaging Compatibility

Product development must include stability testing to ensure that a formulation is stable and that there are no adverse interactions between the package and formulation.

There are many interactions that can occur between the primary pack and the formulation. Some common issues that can arise are:

 Weight loss due to water evaporation through the pack

 Colour leaching from the pack into the product or vica-versa

 Paneling

 Absorption of preservative into certain plastics resulting in reduced preservative efficacy.

 Stress cracking

Transportation should also be considered. Changing demands for smaller shipper cartons and shelf-ready packaging require thorough transport testing prior to introducing a product to the market.

Increasing sales via the internet means that parcels containing a mix of items are being transported direct to consumers. This places additional demands on the robustness of primary packaging when compared to transport of pallet quantities.

Environmental Impact

The Australian Packaging Covenant is a voluntary scheme between Government and companies with the aim of reducing the environmental impact of consumer packaging. The scheme is not backed by legislation, however companies who choose not to be part of the scheme or fail to comply with the requirements of the Covenant will be regulated by the National Environmental Protection (Used Packaging Materials) Measure (NEPM) in each of the states and territories within which the company sells its products.

Member companies are required to submit an action plan with the goals of:

 Design to optimize use of resources

 Recycling to efficiently collect and recycle packaging and

 Product stewardship to demonstrate commitment of all parties.

A new action plan for 2010 to 2015 has been issued which details how the Australian Government will incorporate the principles of the covenant in its operations.

After submission of the initial action plan, companies are required to report on implementation of their action plan in October each year. Over time the action plan will need to be updated.

An action plan has six key directions:

 Taking shared responsibility for reducing environmental impact

 Improving the market for waste and recovered resources

 Pursuing sustainability

 Reducing hazard and risk

 Tailoring solutions to cultures and locations

 Providing evidence of implementation

Summary

Packaging and labelling of Cosmetics in Australia can be a complex task to ensure that all Regulatory, Compatibility and Environmental requirements are met. Marketers must be aware of all these requirements and where in-house expertise is not available then external expertise should be sought.

The ASCC supports harmonization of regulations, absence of deceptive labelling and packaging and efforts to reduce adverse environmental effects of cosmetic products.


References

FAIS Handbook

http://www.health.gov.au/internet/main/publishing.nsf/Content/ocs-faisd-handbook.htm

Guide to Labelling Drugs and Poisons

Australian Competition and Consumer Commission, Cosmetics and Toiletries – Ingredient Labelling (December 2000)

http://www.comlaw.gov.au/Details/F2008C00244

Australian Competition and Consumer Commission, Green Marketing and the Trade Practices Act (February 2008)

http://www.accc.gov.au/content/index.phtml/itemId/815763

Therapeutic Goods Administration, Cosmetic Claims Guidelines

http://www.tga.gov.au/

Commlaw for latest Australian Govt Regulations

http://www.comlaw.gov.au

Australian Made

http://www.australianmade.com.au/logo-usage/

Cosmetic Ingredient Labelling

Product Safety Australia

http://www.productsafety.gov.au


Appendix 1 – Examples of SUSMP Monographs

These examples show that the ingredient monographs can be quite complex and require skill to interpret correctly.

SUSMP Schedule 5 examples

TRIETHANOLAMINE (excluding its salts and derivatives) except in preparations containing 5 per cent or less of triethanolamine.

SUSMP Schedule 6 examples

GLYCOLIC ACID (including its salts and esters) in cosmetic products or when packed and

labelled for use as an agricultural chemical except:

(a) in cosmetic preparations for salon use only which are labelled in accordance with

the National Occupational Health and Safety Commission‟s National Code of

Practice for the Labelling of Workplace Substances [NOHSC:2012 (1994)];

(b) in preparations containing 5 per cent or less of glycolic acid; or

(c) in preparations containing 20 per cent or less of glycolic acid with a pH of 3.5 or

greater.

MELALEUCA OIL (tea tree oil) except:

(a) in medicines for human therapeutic use, when packed in containers having a

nominal capacity of 15 mL or less fitted with a restricted flow insert and

compliant with the requirements of the Required Advisory Statements for

Medicine Labels;

(b) in medicines for human therapeutic use, when packed in containers having a

nominal capacity of 25 mL or less fitted with a restricted flow insert and a child resistant closure and compliant with the requirements of the Required Advisory

Statements for Medicine Labels;

(c) in preparations other than medicines for human therapeutic use, when packed in
containers having a nominal capacity of 15 mL or less fitted with a restricted flow
insert and labelled with the warnings: KEEP OUT OF REACH OF CHILDREN; and
NOT TO BE TAKEN;

(d) in preparations other than medicines for human therapeutic use, when packed in
containers having a nominal capacity of 25 mL or less fitted with a restricted flow
insert and a child-resistant closure and labelled with the warnings: KEEP OUT OF REACH OF CHILDREN; and NOT TO BE TAKEN; or

(e) in preparations containing 25 per cent or less of melaleuca oil.

† PHENYLENEDIAMINES and alkylated phenylenediamines not elsewhere specified in these

Schedules:

(a) in preparations packed and labelled for photographic purposes;

(b) in preparations packed and labelled for testing water except tablets containing

10 mg or less of diethyl-para-phenylenediamine or dimethyl-paraphenylenediamine
in opaque strip packaging provided the directions for use include the statement, “Do not discard testing solutions into the pool”;

(c) in hair dye preparations except when the immediate container and primary pack
are labelled with the following statements: KEEP OUT OF REACH OF CHILDREN, and WARNING - This product contains ingredients which may cause skin irritation to
certain individuals. A preliminary test according to the accompanying directions
should be made before use. This product must not be used for dyeing eyelashes or
eyebrows; to do so may be injurious to the eye. written in letters not less than 1.5 mm in height; or

(d) in eyelash and eyebrow tinting products when the immediate container and
primary pack are labelled with the following statement: WARNING - This product contains ingredients which may cause skin irritation to certain individuals, and when used for eyelash and eyebrow tinting may cause injury to the eye. A preliminary test according to the accompanying directions should be made before use. written in letters not less than 1.5 mm in height.


Appendix II

Agencies with regulations, standards and guidelines concerning cosmetic products in Australia

Permissible ingredients:

National Industrial Chemicals Notification and Assessment Scheme (NICNAS)
GPO BOX 58 Sydney NSW 2001
Tel 1800 638 528 Fax 02 8577 8888

Ingredient labelling requirements and General Advertising Claims:

The Australian Competition and Consumer Commission
PO Box 1199 Dickson ACT 2602
Tel 02 6243 1111 Fax 02 6243 1199

NCCTG Guidelines concerning the cosmetic - therapeutic boundary in relation to advertising claims:

National Co-ordinating Committee on Therapeutic Goods
Therapeutic Goods Administration
PO Box 100 Woden ACT 2606
Tel 02 6232 8636 Fax 02 6232 8687

Packaging & warning requirements for 'scheduled poisons':

National Drugs and Poisons Schedule Committee
Therapeutic Goods Administration
PO Box 100 Woden ACT 2606
Tel 02 6289 3200 Fax 02 6289 3299

Industry Association:

ACCORD

PO Box 290, Broadway. NSW 2007

Fusion Building, Suite C4.02, 22 to 36 Mountain Street Ultimo. NSW 2001

http://www.accord.asn.au/

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