CTFA Technical & Regulatory Workshop

CTFA Regulatory Update CTFA Technical & Regulatory Workshop Garth WyllieExecutive Director

Technical & Regulatory Workshop Programme • HSNO – • The ERMA will talk on: • Current issues • Latest amendment of the Group Standard • New Consumer Law Changes • Summary changes announced by Government are out and have some implications for Cosmetics • Related Products Update • Standards Development • Sunscreen standards – AS/NZS 2604 progress & ISO developments • Other International Standards Development • International Trends and Issues

HSNO – Cosmetic Group Standard • HSNO- • Presented by the ERMA • Speakers - Tonderai Kaitano and Simon Buckland

Consumer Laws and Implications • The Minister has announced the changes to be implemented following last years review • Repealed Laws will be: • Auctioneers Act 1928 • Door to Door Sales Act 1967 • Lay-bys Act • Auctioneers Act 1928 • Amended laws include: • Fair Trading Act 1986 • Consumer Guarantees Act 1986 • Carriage of Goods Act 1976 • Unsolicited Goods and Services Act 1975 • Weights and Measures Act 1987 • Unchanged law • Sale of Goods Act 1908 and its 1994 UN Convention version

Consumer Laws and Implications • What is happening to the repealed laws: • These are all being incorporated into the Fair Trading Act • The prescriptive nature will disappear from most of these laws in favour of a principled basis • But: The devil is in the detail and worse if they are not specific enough open to interpretation by courts and regulators

Consumer Laws and Implications • The Amended laws: • This is where the major impacts for CTFA members are likely • With the laws that previously stood alone going into the Fair Trading Act – enforcement to the maximum penalties of that law will be possible • The Disputes Tribunal will now be able to hear Deceptive and Misleading conduct cases • The Fair Trading Act is being beefed up

Consumer Laws and Implications • Other Amended laws: • The Consumer Guarantees Act is being amended to increase consumer rights • The Carriage of Goods Act will be amended to improve rights • The Weights and Measures Act will be amended to: • Unsolicited Goods and Services Act will be amended putting the onus on the sender to retrieve

Consumer Laws and Implications • Key Impacts for CTFA members • Unsubstantiated claims will be prosecutable which means if you make any claim you cannot proved you may be prosecuted • Disputes Tribunal increased powers • Court Enforceable undertakings • Minor Infringement notices • Performance of Products • Product recalls will have to be notified to the Ministry of Consumer Affairs as a mandatory requirement

Consumer Laws and Implications • Some Plus’s • Unconscionability was dropped from the original proposals (apparently there was better case law) • Unfair contracts were dropped from the original proposal (mostly thanks to the banks and insurance lobbying) • The changes to the Carriage of Goods Act will allow greater recourse against carriers who lose or damage products • Some of Trademe “traders” will now have to honour the Consumer Guarantees Act

Consumer Laws and Implications • Expected Timeframe: • Legislation drafted and into the house by about July • Open to Select Committee process prior to election (about August) • Reporting back of bill to house and second reading likely to be after the election • In law maybe early next year unless it were to be run through under urgency for some reason.

Related Products Update • Related Products Under the Medicines Act • The release of the changes is due in May and Medsafe assures us it is on track • Will include toothpaste below 2.5% • Will include Anti-acne products that make no other therapeutic claims • Will include Anti-dandruff Shampoos that make no other claims to treat any other conditions • Will clarify the exclusion of Mouthwash • Assuming the changes are on time this should be law by the time the house rises for the election.

Standards Development • The AS/NZS 2604 Sunscreen Standard – • Public comment release was supposed to be Feb but due to health issues for the Standard person this has been delayed. Now likely in May although pressure is on to get it done earlier • Timeframe to completion is now likely to be September 2011 if deadlines are met

Standards Development • ISO standard for Natural and Organic Definitions is now at a first draft stage with a number of options to be decided and considerable difference as to the exact parameters • Organic definitions will be easier than Natural but still some issues in common with Natural • The major differences between parties on the Natural or organic definition are: • whether Natural/organic includes or excludes extracted from Natural/organic ingredients • Water in or water out of the definition • Levels of synthetic ingredients where no natural/organic equivalent exists

Standards Development • The ISO has now commenced work on Heavy metals presence in Cosmetics • There is no draft for this yet as terms of reference are only just being agreed • Amendments have been made to the Good Manufacturing Practice Standard to fix some wording errors but will not impact on the key requirements • Amendments have been proposed for the Microbiological Contamination Standard which will tighten some aspects (mostly minor changes)

International Issues Update Europe: • A draft opinion on Parabens from the SCCS supports the continued use of Methylparaben and Ethylparaben at concentrations up to 0.4%. The use of Butylparaben and Propylparaben is considered safe up to 0.19% however there was a lack of scientifically sound data on dermal absorption on the last two relating to the metabolism of the parent compound in the skin. (No human test data exists) • Due to lack of information they still have not formed an opinion of risk for Isopropyl-, Isobuty-, and Phenylparabens. • The same applies for Benzylparaben and Pentylparaben which may be used in Cosmetic products for anti-microbial activity but are not listed in Annex VI of the Cosmetic Directive currently. This may now change with the SCCS as signalled this.

International Issues Update Europe continued • Opinions for hair dye ingredients for potential of sensitization have been issued. These include: • Trisodium NTA (unsafe at max concentration of 5%) • HC Red No 6 (risks to health at permitted levels) • HC Yellow No 13 (Safe at maximum concentration of 2.5%) • HC Red No 3 (Safe at maximum concentration of 3%) • Picramic Acid and Sodium Picramate (safe at max of 0.6%) • HC Red No 13 (Safe at max of 1.25% in oxidative and 2.5% non oxidative hair dye formulations) • Denmark authorities are intending to ban the use of butyl and propyl parabens for cosmetics used by children under 3 years

International Issues Update Europe Continued • Original proposals for hydrogen peroxide levels and use in Tooth whitening products was not supported by all EU States. This is now likely to see a revised set of proposals. These are governed by the Dental Products Groups Standard in New Zealand and similar proposals have been made for New Zealand. • IFRA has released the latest version of its standards booklet for download from the public web site at www.ifraorg.org/en-us/standard_booklet

International Issues Update • Europe • The UK Advertising Standards Authority now controls advertising on company’s own web sites that they control. (.uk only) The New Zealand ASA already does this but without mandatory powers! • Some EU countries have interpreted anti-bacterial hand washes biocidal claims as making the product a biocide and not a cosmetic. Specifically Ireland, Portugal, Spain, Sweden and Austria have taken this view and require additional registration and approval as a result

International Issues Update Europe Continued: • The EU has adopted a new block exemption from competition law for exclusive distribution agreements providing you do not have more than 30% of the market (not likely for an NZ company) • Nano material requirements for Cosmetics under the new Cosmetic Regulation will occur however the definitions are still to be confirmed • The UK’s advertising standards codes have been revised which now allows medicinal claims for cosmetics providing they are backed by evidence. A copy of the codes can be obtained from www.cap.org.uk/The-Codes.aspx • Under “Reach” the 1000 tonne pa threshold had some ambiguity due to the sellers of finished cosmetics not knowing how much of a particular ingredient was being imported into or manufactured in the EU when their product was individually under. The European Chemicals Agency has now agreed to show some flexibility in this should this situation arise. Over 3400 ingredients have been registered supported by some 20723 dossiers so far

International Issues Update Other international: • India’s latest Drugs and Cosmetic Rules 2010 came into effect from 1 April 2011 requiring all cosmetics that are imported into the country to be registered • Israel has adopted the EU (mostly) cosmetic regulation to take effect from the 1st of June 2011. This will be some two years ahead of the same regulations coming into effect in Europe on 11 July 2013 and will include Nano labelling, GMP certificates, formula notification to the poisons centre. There are some differences on traces of prohibited substances, other uses of substances on positive list which have been transposed incorrectly from the EU and text differences which may pose issues of interpretation. • China has announced it will lower import taxes on Cosmetic products (note these are or will be shortly duty free for NZ manufacturers under the Free Trade Agreement already.) Current levels of 50% will be reduced but the level of reduction has not yet been signalled

International Issues Update Other International: • Mexico has agreed to accept internationally used INCI names on cosmetic product labels. (Came into effect on 26 January 2011 with a change of their regulations

International Issues Update US and Canada • The CIR has established task forces to ingredients that are deemed to have insufficient data. The ingredients (not widely used) are: • PEG Cocamine (PEG-5 Cocamine and PEG-15 Cocamine) • PPG Diethylmonium Chloride (PPG-9 and PPG25) • Sodium Lauriminodipropionate • Testing required for insufficient data will include: • PEG – Systemic toxicity • PPG – Systemic toxicity/Genotoxicity/Skin irritation and sensitization • Soidum Lauriminodipropionate – dermal tetatogenicty • EPA has listed a second list of chemicals for tier 1 screening for its Endocrine Disruptor Screening program. 17 are including from the Cosmetic Dictionary including the likes of Glycol and Methyl Alcohol. This is part of the Safe Drinking Water Act chemicals

International Issues Update US and Canada • The Research Institute for Fragrance Materials Expert Panel has issued its conclusion that the following Branched Chain Saturated Alcohols are safe under present levels of use and exposure: • 3,5,5-trimethyl-1-hexanol, 3,7-dimethyl-7-methoxyoctan-2-ol, 4-methyl-2-pentanol, 2-methylundecanol, 3,4,5,6,6-pentamethylheptan-2-ol, isodecyl alcohol, isooctan-1-ol, isotridecan-1-ol (isomeric mixture), isononyl alcohol, 6,8-dimethylnonan-2-ol, 2-ethyl-1-butanol, 2,6-dimethyl-4-heptanol, 3-methyl-1-pentanol, 2-methylbutanol, isoamyl alcohol, 2,6-dimethyl-2-heptanol and 2-ethyl-1-hexanol • Contact hypersensitivity quantitative risk assessment for fragrance ingredients is being used to establish international standards for potential skin sensitizing fragrance ingredients. – A clinical trial has shown this to be an effective tool

International Issues Update US and Canada • The US National Toxicology Programme has issued reports on Isoeugenol and Aloe available from their web site at http://ntp.niehs.nih.gov/htdocs/LT_rpts/TR551.pdf for Isoeugenol and at http://ntp.niehs.nih.gov/htdocs/LT_rpts/TR553.pdf for Aloe. • Their conclusions are after 2 year gavage studies which showed that there was no evidence in most female rats categories of carcinogenic activity however there was equivocal evidence (a maybe) in male rats for isoeugenol. This was stronger in mice with clear evidence in male mice and equivocal in female mice. There was evidence of nonneoplastic lesions on the nose of both male/female rats and wider evidence in mice for nose, forestomach and glandular stomach • This may result in restrictions on the permitted levels

International Issues Update US and Canada • Aloe gel or Aloe-emodin showed a weak enhancing effect for photocarcinogenic activity in female but not male mice • Aloe whole leaf or decolorized whole leaf showed a weak enhancing effect for photocarcinogenic activity for both female and male mice • The may open discussion on the use of Aloe in sun products however given the weakness of the results should not raise any concerns or issues for use in other products. • A study of 54 mothers for presence of UV filters, fragrances and parabens in human milk has been undertaken. UV filters were found in 86.19%. Fragrances Musk xylene (87%), musk ketone (63%) and Hexamethylindanopyran (83%) were found in the samples. Paraben were detected in 63% however Butylparaben was not detected in any. All levels of presence corresponded to the levels in cosmetics

International Issues Update US and Canada • A study on the absorption of Zinc following exposure to Zinc Oxide Containing sunscreens has been undertake. It was found that: • The overwhelming majority of Zinc Oxide was not absorbed with blood and urine samples showing only small increases of Zinc over natural levels • The tracer level in the blood after the 5 day application period 1/1000th that of the total Zinc in the blood (over the natural level) • Tracer levels continues to increase in the blood continued to increase after the 5 day period in contrast to urine which decreased • Levels of Zinc for those using nano particle sunscreens were higher than those not using that sunscreen and higher in females than males. • It should be noted that while this is a clinical trial it was limited to just 20 subjects and the Zinc was enriched to 99% with the stable isotope 68Zn to provide the Tracer and it is unknown whether that had any effect on the results. A larger trial will be required to verify these initial results.

International Issues Update US and Canada • The ASTM Nanotechnology Committee has added a subcommittee on Nano-Enabled Consumer Products to develop scientifically credible standards for identification, evaluation and assessment of engineered nanomaterials in consumer products. They are also to develop standards for determining the presence of engineered nanomaterials in consumer products to better estimate the potential exposure from the use of these consumer products. • The Consumer Product Safety Commission has issued a final definition (rule) on the term “Childrens Product” as being “A consumer product designed or primarily intended for children 12 years of age or younger”. It has also set out the factors that will be used to determine this. • Canada has updated its list of prohibited and restricted cosmetic ingredients. The changes include antiperspirant ingredients to reflect the change of Antiperspirants products from drugs to cosmetics

International Issues Update US and Canada • The CIR has issued reports on a number of ingredients: • Plant-derived Fatty Acid Oils – Safe as used (Final Report) • Alkyl Benzoate Ingredients – Safe as used (Final Report) • DEA and DEA Salts – Safe when formulated to be non irritating (Tentative report) • Formaldehyde/Methylene Glycol – Safe with qualifications, insufficient data, safety in products aerosolised or vaporised not supported • On the last ingredient – this was prompted by hair straightening products containing “Free Formaldehyde” in excess of the EU, Australia and NZ safe levels of 0.2% where the use of Methylene Glycol as a substance separate from Formaldehyde masked the actual level of “Free Formaldehyde” in the products (mostly from Brazil). • The report has bracketed Methylene Glycol with Formaldehyde when assessing the products Formaldehyde content and highlighted that the definition of “Free Formaldehyde” will be at the point of use since heat will release Formaldehyde from both ingredients.

Summary of Resource materials available from the CTFA • GMP Guide for Manufacturing in New Zealand • Templates for MSDS/SDS compliance under HSNO • Frame Formulation Guide • Green Advertising Guide for New Zealand • Cosmetic Advertising Guide for New Zealand • Copies of most international regulations or changes • Copy of the Cosmetic Group Standard under the HSNO Act and all regulations under the Act • Guide to the Sale of Fragrances and Perfumes in NZ • Guide to sale of face paints in NZ • Guide to sale of Sunscreen products in NZ • Guide to Cosmetic Product Recalls • Practical Guide to Good Study Design • The building blocks of claims support • Product Security and Tampering incident Guide • Protecting Nail Health Salon Guide • The Salon Hair Products Guide 2009 • Guide to labelling and Packaging in New Zealand

End of Workshop

CTFA Technical & Regulatory Workshop