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Advertising: when cosmetics are regulated as therapeutic goods

18 November 2021

In Australia, there are differences in the way cosmetic products and therapeutic goods are regulated. They have separate standards and regulatory controls for safety, quality, efficacy, labelling and claims.

The following information will help you determine if a product is a cosmetic or a therapeutic good, and then which regulatory scheme applies.

You may think a product is a cosmetic, but it could be regulated as a therapeutic good based on the following factors:

  • the primary use
  • the ingredients
  • the claims made
  • overall presentation and context
  • regulatory controls

Cosmetic regulation

Cosmetics are managed under the Industrial Chemicals Act 2019 which defines what a 'cosmetic' is and states that a product cannot be a cosmetic if it is a therapeutic good.

The Australian Industrial Chemicals Introduction Scheme (AICIS) regulates chemicals that are imported or manufactured for industrial use including in cosmetics. AICIS regulates ingredients, not products.

Product labelling and safety for cosmetics is regulated by the Australian Competition and Consumer Commission (ACCC).

The Therapeutic Goods Administration (TGA) regulates medicines and products that are marketed for therapeutic use under the Therapeutic Goods Act 1989 (the Act).

These include products such as:

  • skin-whitening creams
  • some sunscreens
  • medical devices
  • over the counter medication
  • biological products
  • Cosmetics for oral consumption

Therapeutic goods need to be entered onto the Australian Register of Therapeutic Goods (the Register). Therapeutic goods not on the Register:

  • cannot be imported, supplied or advertised
  • may be illegal therapeutic goods.

What is a cosmetic?

A cosmetic product is typically designed for use on external body parts including the mouth and teeth.

Typically, these change the appearance or odour, cleanse, condition, maintain or protect the body. They affect appearance rather than the substance of skin.

Products may include:

  • bath salts
  • body lotions
  • deodorants and antiperspirants
  • hair dye
  • hand cream moisturiser
  • lipstick
  • makeup
  • mascara
  • nail polish
  • perfume
  • shampoo and conditioner
  • shaving cream
  • soap
  • toothpaste

A skin moisturiser is an example of a topical skin product that is a cosmetic. However, it would be considered a therapeutic good and not a cosmetic if:

  • it contains an ingredient included in a medicine schedule in the Poison Standard
  • its primary purpose is therapeutic
  • claims include the product being a treatment of skin conditions or diseases beyond those prescribed in the Excluded Goods Determinations or permitted indications
  • advertising presents it as a therapeutic good.

Example

A cosmetic product can be a therapeutic good due to its ingredients

This product is an illegal therapeutic good:

  • It contains hydroquinone – a schedule 2, 4 or 6 poison depending on concentration and purpose.
  • Hydroquinone can be a cosmetic when present in concentrations less than 2% except:
    • hair preparations should be 0.3% or less
    • nail preparations should be 0.02% or less
  • This product contains more than 2% hydroquinone.
  • More than 2% hydroquinone is a schedule 4 poison that can only be supplied with a prescription.

If sold in Australia, the person responsible for the supply could receive fines and potentially a criminal record.

The TGA has released a safety alert on this product.

How to advertise cosmetics

The Australian Competition and Consumer Commission (ACCC) is the primary regulator for cosmetics and is responsible for consumer safety, ingredient labelling and claims of cosmetic products. The ACCC administers Australian Consumer Law (ACL).

Under the mandatory provisions of ACL and Consumer Goods (Cosmetics) Information Standard 2020, the ACCC regulates:

  • product safety requirements
  • false or misleading claims
  • misleading and deceptive conduct
  • the system of mandatory adverse events reporting.

Good advertising of cosmetics ensures that the person knows that the product is a cosmetic and not a therapeutic good.

Using the following words out of context may make a person think the product is a therapeutic good:
Claim to Issue Action on a bodily process
prevent disease influence
diagnose ailment inhibit
cure defect modify
alleviate injury

Do not use images that represent these words.

If taken out of context, the following phrases may be taken as therapeutic, such as:

  • 'reduces/relieves swelling'
  • 'antiseptic/antimicrobial'
  • 'reduces/inhibits inflammation'
  • 'supports good immunity'

The above list is a guide only and not exhaustive.

Some cosmetics can use specific therapeutic claims

Some products are excluded from the operation of the Act to allow limited therapeutic claims to be made.

For example, anti-acne skin care products including:

  • spot treatments
  • cleansers
  • face scrubs
  • masks.

To stay as excluded goods, they are for sale as for controlling or preventing acne through:

  • cleansing
  • moisturising
  • exfoliating
  • drying or caring for the skin.

If advertised for other ailments, such as infection, then the product does not comply with the requirements of the excluded goods order. These products are then defined as therapeutic goods and need to be entered on the Register.

For more information on excluded goods see the Therapeutic Goods (Excluded Goods) Determination 2018.

Examples

  1. Moisturisers that also contain sunscreen can say they are protective against sun burn if they meet the other requirements. For example, are not labelled as greater than SPF 15.
  2. Anti-dandruff shampoo can say they control or prevent dandruff.
  3. Toothpaste can say it prevents tooth decay but not gum disease.

Specific requirements apply. See the excluded goods determination for full details.

Example

Does my sunscreen product need to be on the Register?

This product could be deemed as an illegal therapeutic good because it is:

  • labelled as a hand cream
  • labelled as high protection against the sun (SPF50)
  • not entered on the Register.

Why?

Cosmetics can have a sun protective factor (SPF).

If a product claims more than SPF 15, the product does not look like a cosmetic anymore. The primary purpose of the product shifts from being a hand cream to being a sunscreen.

Primary and secondary sunscreens with SPF 15 and over need to be entered on the Register. Over SPF 15 is deemed to be for therapeutic use.

If sold in Australia, the person who supplies it can receive fines and potentially a criminal record.

Please note this is not an Australian product. It is used as an example only.

Advertising material

Product advertising includes labels, packaging, and marketing material. A consumer considers this information when choosing a product.

Using claims such as 'soothes dry skin' in relation to a skin cream does not make it a therapeutic good. Using this claim alongside pictures of severe dry skin (such as psoriasis) may give an impression that the advertised good is therapeutic.

Using words and images in advertising can cause a product to shift from being cosmetic to being a therapeutic good.

It is always important to consider the overall message a consumer may receive from an advertisement as it is the overall presentation which will determine if they believe it is for a therapeutic use or not.

Example

Advertising on websites can make a product a therapeutic good.

This product appears to be a cosmetic, however it is in fact a therapeutic good for the following reasons:

  • The wording uses terms that are likely to make a consumer believe that the product treats specific conditions including:
    • acne
    • weight loss
    • inflammation
    • liver disease
  • The wording introduces many claims of therapeutic benefit.
  • The video about the product introduces further claims of therapeutic benefit.

As this product meets the definition of a therapeutic good it needs to be entered on the Register.

Offences

Separate advertising offences against the Act can apply for:

  • advertising on each internet platform (primary website and YouTube)
  • each day the advertisement is visible to the public
  • each product that is defined as a therapeutic good due to claims made.

Offences against other legislation that may be applicable to this example may include:

  • import, supply, manufacture, or counterfeit
  • consumer law
  • state and territory laws.

The three regulatory schemes

Cosmetic ingredient regulation

Cosmetic ingredients are managed under the Industrial Chemicals Act 2019 which defines what a 'cosmetic' is and that a product cannot be a cosmetic if it is a therapeutic good. AICIS undertakes the risk assessment of ingredients used in cosmetic products. AICIS regulates chemicals that are imported or manufactured for industrial use including in cosmetics.

Information about cosmetic ingredient regulation can be found on the AICIS website or the TGA website.

Cosmetic product regulation

The ACCC is the primary regulator for cosmetic products and is responsible for consumer safety, ingredient labelling and claims of cosmetic products. More information on cosmetic product regulations can be found on the ACCC Product Safety Australia website.

Therapeutic goods regulation

Therapeutic goods are regulated under the Therapeutic Goods Act 1989 and other subordinate legislation. Other laws can also apply, such as state and territory laws.

The Act defines 'therapeutic goods' as:

goods that are represented in any way to be, or that are, whether because of the way in which the goods are presented, or for any other reason, likely to be taken to be for, therapeutic use.

More information