India has a vast marketplace for overseas cosmetics. The ever-changing lifestyle and augmented per capita income of the people have led to increasing demand for imported skincare products nationwide, especially in metropolitan regions. The Indian market is home to dozens of international brands, including Christian Dior, Avon, Estee Lauder, Burberry, and so on. Currently, the Indian skin care market accounts for 5 percent of the $530 b global industry. Although foreign brands are witnessing stiff competition from home-grown brands, their growth has largely remained steady and promising. But with the increased demand comes the risk of generic and unsafe brands entering India. In view of such risk, the GOI has put forth some legal implications for imminent and existing skincare import business in India. This write-up will help you understand the legalities of this business venture.
Who Can Start Skincare Import Businesses in India?
As per the drug and cosmetic rules 1945, the followings qualify to involve with the business of skincare import:
- The Manufacturer has a registered office in India.
- The Authorised Agent appointed by the Manufacturer
- The Manufacturer’s Subsidiary
- Any other Importer
Which Authority Formulates And Enacts Norms For Skincare Imports?
Presently, the following institutions are involved in the formulation and regulation of skincare products in India, be it a matter of production or importation.
- Drugs Controller General (India)
- Central Drugs Standard Control Organization
- Directorate General of Health Services
- Ministry of Health and Family Welfare
The cosmetic division of the Central Drugs Standard Control Organization deals with the licensing of skincare products.
An Overview of the Types of Forms
The Cosmetic Rules, 2020 advises the filing of the given forms depending on the purpose of business.
Application concerning the issuance of import certification to import cosmetics into India.
Form Cos 2 refers to an import certification of cosmetic products.
Application concerning the grant of import registration for the importation of registered skincare products
Import Registration number to be accorded for the importation of the approved cosmetics into India
Application concerning the accord of approval relating to new cosmetics for securing import registration certification or production license
Legalities around the Establishment of a Skincare Import Business
The Drugs and Cosmetics Act of 1948 governs the skincare import business and manufacturing of cosmetics in India. But, in the year 2020, the GOI rolled out the updated version of the legislation in the form of the Cosmetic Rules, 2020, which encloses the following conditions.
- No cosmetic can find its way to the Indian market if it lacks the approval of the Central Licensing Authority
- Form COS-1 is a prescribed application form for the importation of skincare products in India.
- Agent appointment shall only come into effect after the approval granted either by the first-class Magistrate in India or the competent authority of the importing nation.
- While filing Form COS-1, the applicant must attest documents as per Part I of the Second Schedule.
- The registration application as per sub-rule (2) must go with a copy of the receipt of the fee.
- The applicant can refer to the fourth schedule for knowing the fee structure
- There is also an arrangement for offline application in Form COS-1. The eligibility criteria to apply via offline application are similar to that of online application
- The imported cosmetic may undergo inspection or testing conducted by labs referred to in rule 11. The applicant would be accountable for addressing all the expenses concerning such tests.
- The applicant must bear the expenses mentioned in the third schedule relating to the on-site inspection of the production unit of the importing nation. The officials from the Central Licensing Authority will take charge to inspect the facility.
Documentations for the Grant of a Registration Certificate
Following are the documents required for the grant of a Registration Certificate
- Treasury Challan
- Import Export Code accorded by DGFT
- Power of Attorney
- Copy of the label used on Cosmetics
- Free sale registration/Manufacturing license/Marketing Authorization, if available
- Product specs and testing protocol.
- List of countries where Market Authorization was granted.
- Soft copies of details concerning brands, products, and manufacturer
Provisions around the Import Registration Certificate for Skincare Import
- The detailed vetting procedure will come into effect after the submission of the application relating to the grant of import registration certificate.
- Central Licensing Authority vets the documents and application for any error. In case of any loophole, the authority may revoke the application and then accordingly inform the applicant via writ notice. The notice shall enclose the reasons for cancellation.
- The applicant can plead to the Central Government to reconsider the rejected application within 45 days. The government will look into the matter and accordingly pass the order within 90 days from the date on which the appeal comes to light.
- Form COS-3 mentioned in Chapter V serves as legal approval for the new cosmetics awaiting their arrival in India. Without it, registration for importing new cosmetics shall not come into effect.
- An individual application via Form COS 2 shall be enough to legalize one or more cosmetics produced by the same manufacturer. It doesn’t matter whether cosmetics are being manufactured at a single premise or another facility as long as they belong to a single manufacturer. In such a case, no separate filing of the application is required.
- Licensees looking for a duplicate certificate copy can apply via the prescribed application that goes along with standard fees.
Labeling Norms to Be Followed By Skincare Import Business
- The label affixed on the imported cosmetics shall reflect the brand registration number and the details of the registration holder.
- Affixing of labels enclosing brand registration number may be allowed post import at an apt source approved by the authority concerned. Applicant must file a prescribed application with the licensing authority for this purpose.
- The label must enclose the manufacturer’s name and address and information about the nation where the cosmetics have been manufactured.
- If the production of cosmetics took place in a third-party facility, the name, and address of the owner or the info about the nation, where it has been produced should be legible on the label.
Key Facts to Ponder Relating To Skincare Import Business
- No other language except English is acceptable for filing an application to legalize the skincare import business.
- The applicant must intimate the authority about the nation (source of import) where no legislation exist for regulating the production of cosmetics. The applicant can furnish a declaration on an affidavit to serve this purpose.
- Import certification is not applicable to cosmetic products that are imported for repackaging, export, or R&D purposes. In such cases, CDSCO grants specific approval against the prescribed application. Besides, the importer must furnish an undertaking confirming that such products are not meant for domestic sale.
Given the current growth rate and market conditions, the skincare import business seems to be a remarkably profitable venture. However, it revolves around stringent provisions underpinned by the apex regulators in India. Abiding by such rules is an absolute mandate for business owners to avert severe penalties.
Read Our Article: Process to Set up Export and Import Business in India