Double-edged sword: Why K-beauty industry is calling to abolish ‘unharmonised’ functional cosmetics regulation

Functional cosmetics are a class of products which make specific claims including UV protection, whitening, anti-wrinkle, and anti-acne.

Currently, the regulations exempt functional cosmetics from additional testing, if the products adhere to a set standard of ingredients and concentrations.

This pre-market approval for functional cosmetics was designed to prevent cosmetic manufacturers from making overblown claims and protect consumers.

However, this regulation has proven to be a double-edged sword for the industry, explained Mike Sohn, CEO of REACH24H Korea, a regulatory consultancy.

“Now, even without any kind of testing or proof on a certain finished product, you can still claim it has whitening efficacy just because it has 2% arbutin. According to Korean regulations, yes, it’s a whitening functional product, but in reality, you won’t really know – you don’t even have the data. Even if you meet the standard of 25% zinc oxide for sunscreen, you can’t guarantee product safety.”​

With this regulation in play, domestic producers are encouraged to keep to the status quo, which ultimately poses a hurdle to innovation.

“The regulation states you must have specific ingredients, specific amounts. If you change it, you have to do additional testing. So why would Korean producers change it? The easiest way is to keep the standard,” ​said Sohn.

According to Sohn, domestic manufacturers worry these standards prevent them from competing with foreign counterparts on a global scale.

“I think over 99% of Korean cosmetics manufacturers use 2% to 5% of arbutin. No product goes above 5% when there are products outside Korea that go to 10%. This makes it even more of a hurdle for Korean producers and formulators to challenge newer products.”​

Furthermore, while staying within the standards may make it easier for producers to develop and launch new products, the lack of testing hinders their export potential.

“The regulations are unharmonised. Let’s say they are going to export to China or the EU. You would still need to prove your claims with testing results et cetera, but they don’t have it because Korean regulations don’t need it,”​ Sohn explained.

With Korea Cosmetic Association (KCA) advocating against this regulation, Sohn said there was a “pretty high possibility”​ that producers will get the reform they hope for.

Additionally, they seem to have the support of the current administration, given the growing importance of the K-beauty industry to the South Korean economy.

“Since President [Yoon Suk Yeo’s] regime, there has been some movement to lower the regulatory hurdles especially so Korean manufacturers and producers can create more variety and attempt new challenges in functional cosmetics. This is a very unique regulation and is unharmonised with the rest of the world. What they are saying is that it has to be changed and globalised, so K-beauty can be more competitive.”​