The American Conference Institute (ACI) recently hosted its 12th Annual Legal, Regulatory, and Compliance Forum on Cosmetics and Personal Care Products, bringing together legal experts, regulatory officials, and industry professionals for two days of virtual and in-person sessions focused on the evolving landscape of cosmetics regulation. Hosted in New York City, the event provided updates on state, federal, and international compliance requirements, as well as practical insights on risk management and enforcement trends.
This Q&A highlights key takeaways from three expert presenters at the forum: Dr. Ameki Ooka, Head of Global Supply Chain Resources at the Independent Beauty Association, who spoke on the growing impact of extended producer responsibility (EPR) and recyclability regulations on packaging decisions; Jennifer Santos, Attorney at the National Advertising Division of BBB National Programs, who addressed recent updates to the FTC’s Endorsement Guides; and John W.M. Claud, Attorney at Hyman, Phelps & McNamara, P.C., who discussed regulatory contrasts in Latin American and Chinese markets.
Together, their insights provide a snapshot of the current regulatory pressures and opportunities shaping business decisions in the cosmetics and personal care product industries.
John W.M. Claud, Attorney, Hyman, Phelps & McNamara, P.C.
Presentation – Beauty in Developing World Markets: Contrasting Opportunities and Challenges in the Latin American and Chinese Cosmetics Markets
CDU: Given your experience with FDA-regulated entities, what are the most common compliance challenges that cosmetics brands face when entering the Latin American market, particularly in Brazil and Mexico?
JC: Latin American markets are experiencing strong growth, driven in large part by the rise of social media marketing. However, the region doesn’t operate like a “Southern EU” with a harmonized regulatory framework.
One key challenge is that while the FDA has largely ceded enforcement of cosmetic regulations to the plaintiff’s bar in the US, national agencies like ANVISA in Brazil and COFEPRIS in Mexico take a far more hands-on and rigorous approach. As a result, brands accustomed to the relatively lenient oversight of cosmetics by the FDA must invest significantly in localized regulatory strategies to successfully enter these expanding markets.
CDU: How do the regulatory approaches of ANVISA in Brazil and COFEPRIS in Mexico differ from FDA oversight in the US, and what key compliance pitfalls should companies be aware of?
JC: In Brazil, ANVISA enforces strict registration and labeling requirements, even for products that would be considered “low risk” in the US. Companies must adapt their formulations to comply with ANVISA’s restricted ingredient lists, safety data requirements, and limitations on claims language.
In Mexico, COFEPRIS requires either notification or full registration, depending on the product’s classification. US companies often face challenges due to differing definitions, such as whether a product is considered a “cosmetic” or a “therapeutic,” which can significantly impact the regulatory pathway.
Additionally, both countries require local representation, meaning a legal entity or responsible third party must be present on the ground. Without a knowledgeable partner to provide a clear compliance roadmap, entering the market can become a complex and costly process.
CDU: With increasing demand for clean beauty and sustainability in Latin America, how are regulatory agencies adapting ingredient restrictions, and what steps should brands take to ensure compliance with evolving regulations?
JC: Claims of “clean” cosmetics can be catnip for the plaintiff’s bar here in the US, unless those claims are clearly defined and substantiated. In Latin America, the risk stems from government regulators instead.
That said, agencies in the region are starting to align more closely with EU standards in response to growing consumer demand for clean and sustainable products. This includes tighter restrictions on possible endocrine disruptors, preservatives, and allergens, as well as greater emphasis on biodegradability, safety, and toxicological data for new or plant-based actives.
However, the evolving nature of these regulations shouldn’t necessarily deter companies from acting. I encourage brands to clearly define what they mean by “clean” or “sustainable” in their product labeling and advertising and to be prepared to support the claims to minimize regulatory risk.
CDU: What best practices would you recommend for companies navigating post-market surveillance and regulatory updates in Brazil and Mexico to maintain long-term compliance?
JC: Due to the close regulatory scrutiny cosmetics receive in the region, companies should treat post-market surveillance and staying current with regulatory updates as ongoing operational priorities, not one-time tasks. Having a qualified local liaison is essential for implementing product monitoring programs and staying up to date with legal changes.
As in the US, maintaining a well-organized central compliance file and conducting regular reviews of labels and ingredients are crucial for long-term market viability. Additionally, training is often overlooked—ensuring that commercial and marketing teams are just as informed about the regulatory landscape as upper management can make a significant difference.
The Latin American market is home to a growing middle class that places a high value on beauty and self-care. A well-designed and executed compliance program is a worthwhile investment for companies seeking to tap into this potentially high-growth opportunity.
Jennifer Santos, Attorney, National Advertising Division, BBB National Programs
Presentation – Influencing Beauty: Assessing the Impact of the Endorsement Guides on the Cosmetics and Personal Care Industries
CDU: What are the most significant changes in the updated FTC Endorsement Guides, and how do they impact cosmetics and personal care brands working with influencers?
JS: The FTC’s updated Endorsement Guides clarify what qualifies as an endorsement and what constitutes a material connection between brands and influencers. The FTC also took this opportunity to emphasize the importance of “clear and conspicuous” disclosures, especially in video and social media content, while providing relevant examples of both compliant and non-compliant practices.
Cosmetic and personal care brands often rely on influencer photos, videos, and tutorials to engage consumers, so it is crucial that they understand how to ensure honesty about a product’s performance and transparency regarding any relationships between brands and influencers in compliance with the new Guides.
When brands and influencers clearly disclose connections and make honest claims, consumers are more likely to feel confident in their purchasing decisions, ultimately strengthening brand loyalty and credibility.
CDU: The FTC has set a higher standard for “clear and conspicuous” disclosures. What are the key elements brands should focus on to ensure compliance, especially in video and social media content?
JS: The updated Guides define “clear and conspicuous” disclosures as “difficult to miss (i.e., easily noticeable) and easily understandable by ordinary consumers” and stress that disclosures should be appropriate for both mobile and desktop viewing. The Guides also clearly state that when an endorsement is audible, the accompanying disclosure should be audible, and when the endorsement is visual, the disclosure should be visual as well.
In terms of best practices, your disclosures are more likely to be considered “clear and conspicuous” if they are both audio and visual. And when crafting that disclosure, be sure to consider your audience. What may be “clear and conspicuous” for a teen may not be for an elderly audience.
CDU: Recent NAD cases have highlighted shortcomings in material connection disclosures. What are some common mistakes brands and influencers make, and what best practices should they adopt to avoid enforcement actions?
JS: So far in 2025, BBB National Programs’ National Advertising Division (NAD) has published six decisions that analyze and make recommendations regarding a brand’s material connections disclosures.
Here are some important takeaways from our recent cases:
- A material connection exists not only when there is a financial relationship between the brand and influencer, but also when there is a gifting relationship.
- The influencer, agency, and brand are all responsible for ensuring clear and conspicuous material connection disclosures are used and applied appropriately.
- Placement of your material connection disclosure is important. To ensure it is easily noticeable, it should appear above the fold and shouldn’t require the viewer to click on a hyperlink or to scroll to another screen to view it.
- Make sure your material connection disclosure sufficiently describes the material connection. For example, stating “#paid partnership” alone may not be enough without explaining who the paid partnership is with.
- The FTC acknowledges that using a platform’s disclosure tool alone may not be enough to satisfy the “clear and conspicuous” requirement.
- Consider separating your words or starting each word with a capital letter so that the disclosure can be clearly understood by all viewers (i.e., “#PaidParternshipWithBrand” or “#Paid Partnership With Brand”)
CDU: With the increasing use of AI-generated influencers, what legal and regulatory considerations should cosmetics and personal care brands keep in mind to maintain transparency and compliance?
JS: One of the guiding principles of the FTC Endorsement Guides is that endorsements should reflect the honest opinions and experiences of the endorser with the product. Cosmetic and personal care brands should caution influencers not to use generative AI to create an endorsement that is not true or does not reflect the influencer’s actual experience with the product.
Brands should also be cautious in using virtual influencers or AI-powered chatbots to respond to consumers’ website inquiries, as they may provide misleading information about products or even violate FTC guidelines or certain state laws.
Dr. Ameki Ooka , Head of Global Supply Chain Resources, Independent Beauty Association
Presentation – Packaging In Focus: Navigating the Impact of EPR and Recyclability Regulations for the Cosmetics Industry
Dr. Ooka: Overall, state regulatory bodies remain very active, and in many ways have stepped in where federal regulation has waned. Extended Producer Responsibility is an area that has not seen much federal oversight interest (even before this administration) and is an example of the variability of state-enacted laws and the resulting complexity of compliance for companies.
Oregon is the first state to begin reporting, and companies are all watching how this process works and what fees might result.
CDU: What is EPR?
Dr. Ooka: EPR is a policy framework that requires Producers (usually the brand owner of a product) to either partially or fully fund the collection, sorting, and waste processing of packaging associated with items that they sell and distribute.
In the US, five states have enacted EPR laws: Colorado, California, Oregon, Maine, and Minnesota. Three states have needs assessments underway—Illinois, Maryland, and Massachusetts. Seven additional states have proposed bills so far in 2025. These include Connecticut, Hawaii, Nebraska, New Jersey, New York, Tennessee, and Washington.
The main requirements of EPR laws are that Producers must:
- Register with a Producer Responsibility Organization (PRO),
- Report the quantity and type of packaging sold and/or distributed in the state, and
- Pay a fee based on the type and quantity of packaging they sell or distribute in the state.
There are some exemptions, typically based on tonnage or revenue thresholds, but companies need to review the laws in each state, as they are slightly different.
CDU: Where are we with respect to the laws that have been enacted?
Dr. Ooka: Oregon is the first state requiring reporting submissions, and their deadline just passed on March 31. Colorado will be the next state requiring reporting, likely by August 31, 2025.
Special note on California: CalRecycle just missed their deadline to finalize rules for SB-54, as the governor did not sign off on the rules as drafted. They must revisit rulemaking, but have noted that they will not move statutory deadlines, so this revisit will be highly compressed.
CDU: What are the implications for noncompliance?
Dr. Ooka: Each state’s enforcement scheme looks different, but generally the state agencies will have the right to impose monetary penalties and other administrative measures depending on the violation.
Penalties range from $5,000-$50,000 per day, per violation, depending on the state (For example, Oregon is $25K per day per violation (ORS § 459.995)
Other risks include those from class action or plantiff’s suits, as well as difficulties in meeting source reduction targets. Many states also require that registration lists be made publicly available, which could also create issues for non-compliant companies.
CAA, the PRO for most state compliance programs, is more focused on getting companies on the right path.
CDU: What are some of the challenges companies are experiencing as laws are being implemented?
Dr. Ooka: There are some common pain points identified, particularly as Oregon’s deadline loomed and companies had to gather data. For example, the definition of a “Producer” is different across states—this is challenging for businesses, as they may be obligated in one state but not another.
Another area of confusion is the distinction between Packaging and Product, especially for cosmetics products. For example, in Oregon, CAA has noted that the plastic used for an eyeliner pen is considered a package, but the housing for a writing pen is not considered packaging.
Speakers also noted that confusion on the “covered material” classification of prescription vs. OTC drugs. In some rulemaking, prescription products are considered exempt from covered material classification, but OTC products are not considered exempt.
Thus, in cases where secondary packaging must be reported to the PRO, and where an OTC and a prescription drug product are both delivered to the consumer in the same package (for example, in a cardboard box from an ecommerce pharmacy), it is unclear whether the secondary packaging is considered a “covered material.”
There is also growing concern that non-compliant companies may act as “Free Riders” and not contribute their data and/or fees, resulting in law-abiding companies solely bearing the overall burden of compliance. In this case, there may be self-policing within the industry, as compliant companies or watchdogs may identify suspected “Free Riders” to regulatory or state authorities, or call them out on social media.
CDU: So, what can companies do?
Dr. Ooka: Create an internal Working group and identify process owners. Engage Cross-Functionally, and include Regulatory, Sustainability, Packaging, Sales, and Sourcing. Companies should also ensure their top leadership understands compliance requirements, including fees, and penalties for non-compliance.
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