What requirements must natural ingredients for cosmetics comply with to be allowed on the European market?

The demand for natural ingredients in cosmetics has created exciting opportunities for suppliers in developing countries. At the same time, the regulations for placing cosmetics on the European market are some of the most stringent in the world. Manufacturers and cosmetics brands have to respond to increasing expectations from consumers and governments. This includes higher standards for product safety, as well as for social and environmental responsibility. This has resulted in a large number of requirements that suppliers have to satisfy.

1. What are mandatory requirements for natural ingredients for cosmetics?

The safety of the cosmetic product is the main focus of the mandatory requirements in the European market. All cosmetic ingredients must be used at safe concentrations based on scientific data. The cosmetic product must also be safe, based on a safety assessment and further supported with justifiable claims and clear labelling on the final product about the ingredients, the function of the product and any precautions to be taken. In the medium to long term, these requirements are expected to become more stringent and include more legislation on social and environmental due diligence.

To meet the demands and expectations of European customers, the key requirement for you as a supplier is to have total knowledge of the composition, safety and efficacy of your ingredients. Providing this level of data will help you sell high-value cosmetic ingredients rather than low-value raw materials. At the same time, the data will allow your customers to draw conclusions about the maximum safe concentrations of the cosmetic ingredients to achieve a desired functionality or cosmetic claim (or efficacy) for their product.

The key legislation you need to be aware of in order to meet mandatory requirements on safety and due diligence is as follows:

Cosmetic Regulation

The European Cosmetic Regulation (EC Regulation 1223/2009) is the starting point for understanding the mandatory requirements in the European Union (EU) for any substance used as a cosmetic ingredient. It is the main regulation for cosmetic products intended for the EU (European Union) market and aims to ensure a high level of human protection. The legislation sets out a number of requirements for substances used in cosmetics and is aimed directly at companies placing cosmetic products on the European market. It is particularly advisable to focus on Chapter 4 and Annexes I-VI of this regulation, where you can find information on restrictions for certain substances used in cosmetics. In the case of the United Kingdom, the UK cosmetics regulation is almost identical to the EU legislation.

There are currently 1,729 substances listed in Annex II of the Cosmetics Regulation that are prohibited. Some of these substances can be found as contaminants in legally allowed substances. For example, if you sell cold-pressed unrefined sesame seed oil, it may contain lead (Pb). Lead is a banned substance in cosmetics, as are other heavy metals. If your vegetable oil contains lead, buyers may not want to buy it because cosmetic manufacturers cannot use it in their products unless the lead can be reduced to safe levels.

In addition to the prohibited substances, Annex III of the Cosmetics Regulation lists 372 restricted substances that can only be used in cosmetics if they comply with the conditions of use set out in the legislation. The restricted substances include the allergenic substances found in most essential oils. For example, if you produce black pepper essential oil, nutmeg essential oil or a citrus oil, it is very likely to contain d-Limonene. This is one of the 26 allergens found in essential oils and is listed as a restricted substance. The presence of this substance must be indicated in the list of ingredients if its concentration exceeds 0.001% in ‘leave-on’ products or 0.01% in ‘rinse-off’ products.

The Cosmetics Regulation also defines a list of permitted colourants, preservatives and UV filters that are allowed in cosmetic products. If your ingredient has one of these properties and is not listed in the regulation annexes, it cannot be used for that main purpose. For example, natural colouring agents that are not listed in the legislation’s annexes cannot be used as colouring agents in your product. Although it is possible to apply to the Scientific Committee on Consumer Safety to add new substances to the lists in the annexes to the legislation, this is rarely done as the average cost to the applicant is very high.

There are frequent amendments to the Cosmetics Regulation, especially regarding the substances in the Annexes. The most recent amendment is Commission Regulation (EU) 2023/1545 of 26 July 2023 referring to the labelling of fragrance allergens in cosmetic products. This regulation has added more than 60 new restricted substances for the fragrance industry including well-known natural oils such as patchouli, mint, lavender and rose. There is now a maximum concentration allowed in ‘leave-on’ and ‘rinse-off’ products. The full impact of this will not be noticed until 2028 and beyond. However, it might be expected to reduce the overall demand for these natural ingredients.

In addition, the Cosmetics Regulation requires manufacturers of cosmetic products to prepare and submit to the European authorities a Cosmetic Product Safety Report (CPSR) containing full details of the product and its ingredients. The CPSR must include the following information:

• Chemical identity of the substances (including chemical name, INCI, CAS, EINECS/ELINCS where possible) and their intended function;
• Physical and chemical properties of the substances or mixtures;
• Microbiological specifications of the substances or mixtures;
• Purity of substances and mixtures; and,
• Toxicological profile of the substances contained in the cosmetic product for all relevant toxicological endpoints (especially for new or hazardous ingredients).

As a supplier, it is therefore very useful to have a good understanding of the data that the manufacturer must include in this report, and your technical documentation should at least meet the requirements set by the legislation. You should prepare well-structured technical documentation to present data about your ingredient to your customer and the cosmetic product manufacturer in relation to the requirements of the legislation. As a minimum, you will need to prepare a product specification document, a certificate of analysis (CoA) and a safety data sheet (SDS).

Registration, Evaluation, Authorisation and Restriction of Chemicals

The second key legislation you should be familiar with is Regulation (EC) No 1907/2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals, more commonly known as REACH. The REACH system aims to ensure a high level of protection of human health and the environment, including the promotion of alternative methods for assessing the hazards of substances. For the UK, there is UK REACH. It is almost the same as the EU REACH, with similar roles and responsibilities. The EU REACH still applies in Northern Ireland under the Northern Ireland Protocol.

Under REACH, companies that manufacture and import chemicals in the EU and the European Economic Area (EEA) are responsible for the safe use of their products. Therefore, they must register their chemicals and assess whether these may cause adverse effects on human health and the environment. This is done based on reliable evidence and using alternative information that has been scientifically justified and submitted in a registration dossier.

The underlying safety principle of REACH is that larger quantities pose greater risks to human health and/or the environment. Accordingly, the amount of data required in the registration dossier depends on the quantities manufactured or imported annually. REACH requires every European importer or manufacturer to obtain a registration number for any substance they import or manufacture above 1 MT per year unless the substance is exempted. Exempted substances have intrinsic properties that are considered safe for human health and the environment, regardless of the annual quantities imported or manufactured in Europe. This includes vegetable oils as they are non-hazardous. However, essential oils are not exempted from REACH.

Although REACH only directly applies to European companies, it is useful for non-European companies to understand how REACH works for 2 main reasons. First, REACH includes requirements for safety data sheets related to compilation, format, supplier information and more. All substances, including natural cosmetic ingredients, must have their own safety data sheet when they are transported to and within Europe, regardless of the quantities imported or manufactured. Under internationally harmonised classification and labelling rules, non-European companies must also have a Safety Data Sheet when transporting their chemicals from the place of manufacture to the EU.

Second, there is a mechanism called ‘Only Representative’. This allows a non-European company to participate directly in REACH. Companies join a substance consortium (formally known as a Substance Information Exchange Forum, or SIEF) by setting up a European agent to represent it in the consortium. This agent is called an ‘Only Representative’ (OR). The advantage of setting up an OR is that the non-European company obtains a REACH registration number for its substance. This gives the non-European company the right to sell in Europe up to the maximum amount of substance linked to its registration number. Without their own registration number, non-European companies are limited to selling to EU companies that have a registration number for that substance, or to selling up to 1 MT per year per substance per importer that does not have a registration number. In this sense, non-European companies with ORs in the consortium may have some commercial advantages in doing business with EU companies that do not have a REACH registration number and wish to buy more than 1 MT annually. This mechanism can help increase the value of the company and make it competitive with other exporters as well as other companies in the European consortium. However, you should be aware that obtaining a REACH registration number can cost at least 40,000 EUR.

Classification, Labelling and Packaging Regulation

The third key legislation with which you should be familiar is the Classification, Labelling and Packaging (CLP) Regulation (EC Regulation 1272/2008). It aims to ensure a high level of protection of health and the environment, as well as the free movement of substances, mixtures and articles. As indicated by its name, this legislation governs how hazardous substances must be classified, labelled and packaged. In the EU, hazard labels and safety data sheets are required to communicate the presence of a hazard to the user. The CLP Regulation sets out detailed criteria for the labelling elements.

The CLP Regulation is based on the United Nations Globally Harmonised System of Classification and Labelling of Chemicals (GHS). Many countries have adopted the GHS in their own legislation. Thus, the requirements of the CLP Regulation should already be familiar to non-European companies to classify, label, package and transport chemicals in their own countries. The CLP data are incorporated into several sections of the Safety Data Sheet.

Convention on International Trade in Endangered Species of Wild Fauna and Flora

The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) is an international agreement that aims to ensure that international trade in specimens of wild animals and plants does not threaten the survival of the species. To export cosmetic ingredients to the European market, you must meet the internationally agreed requirements for trade in plant resources under CITES. This is because the EU has incorporated CITES into EU law through Regulation (EC) 338/97. The EU Regulation requires an import permit or an import notification for certain species listed in Annexes A to D. Your own country is likely to be a signatory to CITES, which means that you will also need to comply with it to meet your own national laws.

Convention on Biological Diversity (CBD)/Access and Benefit-Sharing (ABS)

To export cosmetic ingredients to Europe, you must also meet the requirements on the use of plant resources agreed under international treaties and protocols of the Convention on Biological Diversity (CBD). This is because the CBD is part of EU legislation. In addition to the CBD, European companies must comply with the Nagoya Protocol On Access and Benefit-Sharing (ABS), which provides guidelines for accessing and using genetic resources and traditional knowledge, as well as on the fair and equitable sharing of benefits. Exporters of essential oils to the cosmetics sector should be sure to comply with ABS legislation. European buyers can be expected to ask you questions about both CBD and ABS. In addition, both legislations are likely to be part of your own country’s legislation.

EU Deforestation Regulation

The EU Deforestation Regulation (EUDR) is perhaps the most recent key piece of legislation for the natural cosmetic ingredients sector. Regulation (EU) 2023/1115 was published at the end of June 2023 and came into force on 29 June 2023. The EUDR responds to concerns about increasing pressure on forests due to climate change and growing demand for agricultural products. It aims to combat deforestation (especially ‘imported’ deforestation), reduce the EU’s impact on global deforestation and forest degradation, and ensure that the products consumed, as well as their supply chains, are deforestation-free.

The EUDR requires EU companies to ensure that cocoa, coffee, palm oil, rubber, soy, timber and products made from these commodities are not linked to deforestation. In order to place these products on the European market, companies now have to ensure traceability back to the plantation, assess the risks (deforestation, respect for indigenous peoples, etc.) depending on the areas of supply and take measures to mitigate them. The EUDR requires companies to verify that commodities and products are both deforestation-free and legal by meeting these 3 conditions:

• products come from land that was not subject to deforestation after 31 December 2020;

• products were produced following the laws of the country where they were made; and,
• products are covered by a due diligence statement.

To provide sufficient information to ensure that the product contains no or low risk of deforestation, companies are required to collect precise geographical information on the land where the commodities have been grown. In particular, they have to geolocate the origins of the product on the plot. This information is specified in the due diligence declaration, which is recorded in a centralised European information system. Companies are also required to carry out due diligence before exporting or placing their product on the market. This includes conducting risk assessments and adopting measures to mitigate risk, such as carrying out independent audits or supporting suppliers through capacity building.

This regulation will impact the cosmetics sector as it targets raw materials widely used in the industry, such as the derivatives of some commodities used in personal care products (palm oil and its derivatives, cocoa butter and its derivatives, soy oil and its derivatives, etc.). Buyers in the cosmetics sector demand more information from their suppliers on the tools and practices implemented to ensure the compliance of imported products.

2. What additional requirements and certifications do buyers request in the natural ingredients for cosmetics sector?

In the cosmetic ingredients industry, additional buyer requirements relate mainly to quality standards and social and environmental responsibility in the supply chain. There is currently a wide range of certifications and schemes to choose from. These cover ethical and responsible sourcing, fair trade, and natural and organic designations. However, sustainability expectations can no longer be considered optional.

Quality management standards

European buyers of natural ingredients for cosmetics are increasingly employing quality management standards for assessing the credibility of potential exporters. Adopting quality management standards can give you credibility by showing your commitment to supplying high-quality ingredients, while giving your company a favourable image. It can also help you demonstrate compliance with mandatory requirements.

As a minimum, suppliers should have a document similar to the Hazard Analysis and Critical Control Point (HACCP) system used by the food industry. You should ensure that you: (a) know where the risks are throughout the whole supply chain in relation to the quality of your cosmetic ingredient, (b) know how to control or manage them, and (c) confirm that you are doing so. The HACCP plan can be adapted to follow the critical requirements of the Cosmetics Regulation.

There is a specific quality management standard for the cosmetic ingredients industry. This is the Good Manufacturing Practice (GMP) certification scheme of the European Federation for Cosmetic Ingredients (EFfCI). GMP is based on the ISO9001:2015 standard. If you are already ISO9001 certified and supply cosmetic ingredients, it is recommended that you add this EFfCI module. If you supply cosmetic ingredients and do not have ISO9001, it is recommended that you consider investing in this certification or at least get familiar with the requirements of the EFfCI GMP scheme and develop your quality systems accordingly. You can do this initially without certification. Although the GMP is not mandatory for cosmetic ingredient manufacturers, compliance can be a competitive advantage. Following basic GMP practices, as well as HACCP, will help you deliver a good and reliable level of quality.

There are also European buyers of cosmetic ingredients who want their suppliers to follow more complete safety standards, such as those used by the food industry. Some useful standards for companies whose products are sold to both the international food industry and the cosmetics industry are ISO 22000:2018 and Food Safety System Certification FSSC22000. Reference can also be made to the Codex Alimentarius standards, although certain standards (for example, for heavy metals and other contaminants) are stricter for the cosmetics industry.

Labelling and packaging

You will need to label your products to meet legal and buyer requirements. Often your buyer will provide instructions on how to label the products they are buying. You should label your products in English unless your buyer wants you to use a different language. Your product labelling should include the following information:

• International Nomenclature Cosmetic Ingredient (INCI) name and product name;
• Chemical Abstracts Service CAS number;
• Name and address of exporter;
• Batch code;
• Place of origin;
• Date of manufacture;
• Best before date;
• Net weight;
• Recommended storage conditions; and,
• Organic certification number, along with the name/code of the certifying inspection body if you export organic-certified ingredients.

Packaging requirements vary depending on the type of ingredient and the specific requests of the buyer. However, there are some common requirements that must be met in all cases:

• Use drums that conform to UN standards;
• Ensure that packaging materials (for example, drums) are clean and dry before loading the ingredient;
• Rinse headspace with nitrogen;
• Store containers in a cool, dry place to avoid deterioration of quality; and,
• Physically separate organic ingredients from non-organic ingredients.

Figure 1: Examples of packaging for some natural cosmetic ingredients like vegetable oils

Source: Shutterstock.com, 2023

Social and environmental responsibility

Buyers are increasingly asking suppliers for evidence of activities that contribute to social and environmental responsibility. In other words, buyers want to know whether the company makes money in a responsible way. Although this was considered more of a niche requirement in the past, it has now become mainstream. At one level, many companies in the sector are aligning their activities to the United Nations Sustainable Development Goals (SDGs). At another level, an increasing number of companies are seeking certification around various themes, including natural, organic, fair trade, ethical trade and biodiversity conservation. These buyers look for suppliers that are aligned to their own ethical and sustainability principles and standards.

The starting point for much of the work around social responsibility is traceability. European companies need to know where their raw materials come from and, more importantly, they need to know about the social and environmental standards implemented in their supply chains. One of the benefits of certification is that it often includes traceability, which has the additional benefit of third-party accreditation. Third-party certification and approvals can strengthen the credibility of your company and your ingredients. In the table below, you can find an overview of the best known and most widely used certifications in the sector.

Table 1: Most relevant certification schemes in the sector of natural ingredients for cosmetics

Name of certification body	Type	Cost for companies	Main European markets used in	Further information
UEBT	Sustainable use of biodiversity, and Access and Benefit Sharing.	There is an annual membership fee based on the total annual revenue of the member organisation. There is also an ingredient certification fee starting at € 275 per organisation.	France, Germany, UK, Spain	https://uebt.org/certification-1
NATRUE	Natural and organic for final products and for raw materials. Raw materials can be certified (from organic agriculture) or approved (for conventional ingredients).	Natrue label fee of € 50 per approved or certified ingredient for a 2 year certificate, plus the cost of the evaluation by the certification body (approx. € 200 per ingredient every 2 years).	Germany, Switzerland, Italy, Austria	https://natrue.org/our-standard/certification-process-step-step/
COSMOS	Natural and organic.   Also has Approved or Certified (when a product contains organic certified content) status for ingredients.	Fees provided by certification bodies. For example: Flat rate: € 800 for the certificate Audit: € 500 per day COSMOS annual fees: € 4 per ingredient Annual variable rate: € 200  Testing fees charged to company.   A common COSMOS licence fee applies to all products and ingredients, and each Certification Body charges it.	Italy, Germany, France, UK	https://www.cosmos-standard.org/en/certification/cosmos-certification/
Fairtrade	Social, economic and environmental.	Depends on the size of the organisation, number of workers and number of products.	Germany, UK, France, Italy	https://www.fairtrade.net/about/certification
Fair for Life (part of the Ecocert group of certifications)	Social, economic and environmental.	Using the FFL label is free of charge for certified operations. You only pay for the audit and certification.   Certification costs vary depending on the size and complexity of your supply chain, the certification(s) for which you want to apply, the location of your operation and of producers (local costs and travel time), and whether you are already certified organic or have other certification.	France, Germany, UK, Spain	https://www.fairforlife.org/pmws/indexDOM.php?client_id=fairforlife&page_id=become&lang_iso639=en
FairWild	Social, economic and environmental for wild-harvested ingredients.	The costs of the certification audit are calculated individually. They depend on the location, size and complexity of operations, and they include the audit, evaluation, certification and office costs.	Germany, France, Italy, UK	https://www.fairwild.org/fairwild-certification

Source: Fair Venture Consulting & ProFound, 2024

Although buyers value certificates, applying for them is not necessarily interesting or advisable for all producers. Only companies that can afford the costs of certification, conversion and administration should become certified. For other companies, there are some widely recognised self-assessment systems that can serve as a stepping stone to certification, either for ethical performance or for communicating the extent to which their ingredients are natural. What is most important is that you implement activities that make a difference to the planet and to people, to measure what you are doing and to communicate it.

Two of the main self-assessment options for companies are Sedex (Supplier Ethical Data Exchange) and the United Nations Global Compact. Neither of these options is third-party certified, although Sedex has an option whereby companies can choose to undergo an external audit of their operations. This audit is known as SMETA (Sedex Member Ethical Trade Audit) and is increasingly popular and recognised among buyers. Companies must pay for Sedex membership and a fee of 50 GBP, plus the fees for the audit carried out by an accredited certification organisation.

Table 2: Examples of key self-assessments in the natural ingredients for cosmetics sector

Name of certification body	Type	Cost for companies	Main European markets used in	Further information
Sedex	Ethical self-assessment.   Questions are based on the 4 SMETA pillars: Labour Standards; Health and Safety; Business Ethics; and Environment.	119 GBP per year per site (at time of writing).	UK, France, Germany, Netherlands, Spain, Switzerland	https://www.sedex.com/solutions/sedex-platform/
UN Global Compact	Human rights, labour, environment and anti-corruption.	No fees for small and medium-sized companies.	Worldwide	https://unglobalcompact.org/participation
ISO16128: parts 1 and 2	Natural and organic.	Voluntary application of the ISO standard.	UK, Spain, France	https://www.iso.org/standard/65197.html

Source: Fair Venture Consulting & ProFound, 2024

Future developments on sustainability

European buyers face increasing pressure from EU legislation to ensure that their supply chains are sustainable and transparent. Looking ahead, the most important developments to be aware of are the European Green Deal and the Corporate Sustainability Due Diligence Directive. Both proposals will indirectly affect you if you are doing business with European companies.

The European Green Deal is a framework for a series of actions around climate, agriculture, energy, industry and the environment. The aim is to transform the EU into a modern, resource-efficient and competitive economy, ensuring: no net emissions of greenhouse gases by 2050, economic growth decoupled from resource use and no person or place left behind. As part of the Green Deal, the European Commission has also developed a Chemicals Strategy for Sustainability, which includes a revision of REACH legislation.

The Corporate Sustainability Due Diligence Directive sets obligations for European companies to mitigate their negative effects on human rights and the environment, such as child labour, slavery, labour exploitation, pollution, deforestation, excessive water consumption and damage to ecosystems. Companies have to identify, assess, prevent, mitigate and remedy their own negative impact and that of their upstream and downstream partners on people and the planet, covering all stages from production and supply to transport, storage, design and distribution.

None of these proposals will directly affect you as an exporter, as the obligations are imposed on European companies. However, if you are part of a global supply chain for a European company, you will be affected by the due diligence processes through which companies can identify, prevent, mitigate and account for how they address their actual and potential adverse impacts. European buyers are looking for the presence of a transparent supply chain and want guarantees that the product they buy can be easily traced back to the source to verify good social and environmental practices. More specifically, European companies are expected to implement activities that conform to the expectations of these 2 proposals when they become law. Therefore, to supply European companies, suppliers also have to meet these criteria.

3. What are the requirements and certifications for niche markets in the natural ingredients for cosmetics sector?

Within the wide range of certifications used by the natural ingredients for cosmetics sector, natural, organic and fair trade are more relevant to niche markets. Products that meet these natural and organic requirements represent a small part (around 5%) of the European market. However, their share is becoming increasingly important as the use of these private and voluntary standards provides a basis for companies to support their claims and aid transparency.

Natural and Organic

Natural and organic ingredients for cosmetics are the largest and most important niche markets. The definition of natural and organic cosmetics is based on the leading private sector standards, namely NATRUE and COSMOS. Both standards apply to final cosmetic products. However, they also have implications for the natural ingredients used in the final products. Both private standards are well established in the cosmetic ingredients market. They have similar, but not identical, definitions for organic and/or natural ingredients and final cosmetic products. For both COSMOS and NATRUE, natural ingredients and raw materials can be either certified (if they meet organic content requirements) or approved (if not organic).

To market an ingredient as organic, you must implement organic farming techniques and have your supply chain and facility approved by an accredited certifier. The requirements on organic production and labelling are specified in EU Regulation 848/2018. Apart from NaTrue and Cosmos, other standards relevant for the organic cosmetics market are the Soil Association Organic (the UK’s largest organic certification body), BDIH (Germany’s Association for Industries and Trading) and ICEA certifications (most influential Association for Organic Agriculture in Italy). The German BDIH requires raw materials of plant origin to be certified organic, while the Italian ICEA requires ingredients of natural origin from certified organic farming.

The International Organization for Standardization has also introduced a two-part natural and organic standard for cosmetics and cosmetic ingredients (ISO16128 part 1 and part 2). Apart from purchasing the ISO standard, companies can introduce it into their supply chain without paying certification costs. One criticism is that it is self-certification, not third-party certification. However, it also has several positive aspects, primarily that it is a low-cost approach to demonstrating natural and organic status. The barriers to entry for natural and organic products are lower, which should lead to an increase in the number of companies developing natural and organic products. Several large companies use this standard and follow its guidelines, including Lipoid Kosmetik, BASF, Silab, Nivea, Guerlain, Rituals, Burt’s Bees, Croda and Clariant.

Fair production and fair trade

Certified fair trade and production is a small niche market in terms of cosmetic ingredients. It covers important issues like human and workers’ rights, community well-being, biodiversity conservation and local development. European cosmetics manufacturers are becoming increasingly interested in transparent and sustainable supply chains.

Fairtrade International is one of the most common certificates, associated with cosmetics for more than 30 years. Although it is a small part of the market, Fairtrade-sourced ingredients continue to make an important contribution to social development.

Other relevant certifications related to fair production and trade standards include:

• Fair for Life, which promotes fair and positive relations between actors in the supply chain, standing for fair working conditions, fair pricing, respect for human rights and the environment, and traceability;
• FairWild, which certifies the use of sustainable collection, social responsibility and fair trade practices; and,
• UEBT (Union for Ethical Bio Trade), which promotes the ethical sourcing of ingredients from biodiverse environments, standing for practices that support biodiversity conservation and fair and equitable sharing of benefits, among other causes.

Figure 2: Examples of common certification schemes in the natural ingredients for cosmetics sector

Source: Various, 2023

ProFound – Advisers In Development and Fair Venture Consulting carried out this study on behalf of CBI.

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