Cosmetics

Introduction

India’s cosmetic industry has grown consistently over the last few years. The Indian market has strong presence of both locally manufactured as well as imported cosmetics. A number of international cosmetics brands have entered India, which validates the potential of the industry to grow further.

Most Important laws

  • The Drugs and Cosmetics Act, 1940 and Rules framed under the Act regulates the quality of cosmetics that are imported, manufactured, distributed and sold in India.
  • The Consumer Protection Act, 1986 / the Consumer Protection Act, 2019 protects consumers against misleading claims, and imposes product liability obligations for manufacturing harmful cosmetics.
  • Code for Self-Regulation in Advertising published by The Advertising Standards Council of India provides detailed guidance on claims that cosmetics companies can make for their products.
  • The Trade Marks Act, 1999 provides protection to brand name for the cosmetics, in addition to common law protection for passing-off of trade dress and packaging.
  • The Competition Act, 2002 regulates anti-competitive behaviour amongst manufacturers, supply chain and other stake holders.
  • The Legal Metrology (Packaged Commodity) Rules, 2011 prescribe numerous labelling requirements, including declaration of customer care number, on the package.

Key things to remember

  • Indian law imposes licensing requirement for cosmetics only at source. This means that activities such as manufacturing and import require license for registration but sale of cosmetics does not.
  • Cosmetics that have been tested on animals on or after 2014 are banned to be imported into India.
  • No clinical data is required to introduce first in human cosmetics.  Further, no license is required to undertake research on cosmetics (unlike drugs).
  • The marketing authorization holder for imported cosmetics in India is the only entity that is permitted to import cosmetics into India.
  • The address of the actual manufacturing site of cosmetics is required to be declared on the label.
  • Claims related to fairness are not permitted in India.

Important sub-segments and related industries

  • Haircare
  • Skincare
  • Oral care
  • Fragrances
  • Cosmoceuticals

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