CONDITIONS AND PROCEDURES FOR ESTABLISHING COSMETIC MANUFACTURING FACILITIES

The cosmetic industry is an industry that is always in great demand and growing strongly, cosmetic production facilities also grow up massively. However, it is not only necessary to establish a business and register a business to be able to produce cosmetics, but cosmetic production establishments must also meet specific conditions as prescribed by law to avoid legal risks arise. Here are some notes for business owners who want to set up a cosmetic manufacturing facility.

Legal basis:

Decree 93/2016/ND-CP of the Government;

Decree 117/2020/ND-CP of the Government;

Circular 277/2016/TT-BTC of the Ministry of Finance.

1. Conditions for issuance of Certificate of satisfaction of conditions to produce cosmetics (SC Certificate)

An establishment producing cosmetics much fully satisfy the following conditions:

Conditions regarding personnel

The person responsible for production at the establishment must have specialized knowledge in one of the following faculties namely chemistry, biology, pharmacology or some other faculty relevant to the work requirements.

Conditions regarding material facilities

• Having a location, area, factory and facilities which satisfy the requirements for a production line and for the type of cosmetic products which the establishment proposes to produce and as set out in its application file for issuance of an SC Certificate;

• Having a store for preserving raw materials, packaging materials and finished products which ensures separation of these three items from each other; and having a separate store to preserve inflammable objects and substances which could explode or which are highly toxic, and materials, raw materials and products which are rejected, re-called or returned.

Having a quality control system which satisfies the following requirements

• Raw materials, supplies and semi-finished products used during the production of cosmetics must satisfy the quality standards of the manufacturer;

• Water used during the production of cosmetics must, at the minimum, satisfy the national technical regulation on drinking water quality issued by the Minister of Health [QCVN01:2009/BYT];

• There must be production processes for each product;

• There must be a quality control section to check the quality of raw materials, semi-finished products, products awaiting packaging, and of finished products.

2. Procedures for applying for a Certificate of satisfaction of conditions to produce cosmetics

Step 1: Submit the application directly or by post to the Department of Health in the locality of the production plant

Application includes:

• Request for issuance of an SC Certificate to produce cosmetics on standard form 2 in the Appendix issued with Decree 93/2016/ND-CP of the Government;

• Diagram of the ground area and design of the production establishment;

• List of current equipment at the production establishment.

Within two (02) working days from the date of receiving the application for the Certificate of satisfaction of conditions to produce cosmetics, the Department of Health is responsible for checking the application and issuing a receipt or provide written notice if the file is either incomplete or invalid.

Step 2: The local Department of Health receives and checks the application

The Department of Health is responsible, within thirty (30) days after receipt of a valid application file and evaluation fees to check the production establishment, to then issue an SC Certificate; if the Department does not agree to issue an SC Certificate, or if it requires the establishment to make changes or remedy problems, then it shall provide a written notice setting out its reasons.

In a case where an establishment is required to make changes or remedy problems:

• The production establishment must make the changes and remedy the problems and thereafter send a report to the Department of Health;

• The Department of Health is responsible to consider the report and checking the file, or conducting another inspection at the production establishment if considered necessary. The inspection agency shall, within fifteen (15) days after receipt of the report on remedial action taken [by the establishment], provide a report on the result of its inspection;

• If within six (06) months after the date on which the Department of Health issues its written request for the production establishment to make changes or remedy problems, the Department has still not received a report from the establishment on the remedial action it has taken, then the application file for issuance of the SC Certificate shall no longer be valid.

Note: If the Ministry of Health has already issued a Certificate of Cosmetic Good Manufacturing Practice (CGMP- ASEAN) to an establishment producing cosmetics, The Ministry of Health shall provide written notice to the Department of Health in the locality of the production plant regarding issuance of an SC Certificate (The Department of Health is responsible, within five (05) business days after receipt of the letter from the Ministry of Health, to issue the SC Certificate to the production establishment in question).

3. Evaluation fee

According to the provisions in Section 13 of the Fee Schedule issued together with Circular 277/2016/TT-BTC, the fee for assessment of cosmetic production conditions and issuance of SC Certificate is VND 6,000,000/facility.

4. Penalties for producing cosmetics without the SC Certificate

According to the provisions of Article 70.2 of Decree 117/2020/ND-CP of the Government, in case a cosmetic manufacturer produces cosmetics without the SC Certificate, it may be fined:

• A fine ranging from VND 40,000,000 to VND 50,000,000

• Additional fines: Suspension of cosmetic production activities until the EC Certificate is granted in accordance with the law, but not more than 24 months

• Remedy: Forced recall and destruction of all cosmetic products.

ADK & Co Vietnam Lawyers Law Firm