The aim of this explanatory note is to provide guidance with respect to the scope of application of Regulation 1223/2009/EC of the European Parliament and of the Council of 30 November 2009 on cosmetic products[1] (hereafter "Cosmetics Regulation"), i.e. the application of the legal requirements set out in that Regulation to cosmetics placed on the Union[2] market via websites established in a non-EU Member State.
While the matter was discussed in the context of the adoption of the Cosmetics Regulation, no express provisions in the Cosmetics Regulation address the issue. As a result, a Commission Declaration attached to the Cosmetics Regulation stated that "The Commission commits to clarifying the situation regarding Internet sales of cosmetic products prior to the date of application of the Regulation".
As demonstrated further in the note, a legal analysis of the letter and the purpose of the Regulation leads to the conclusion that the selling of cosmetic products to EU consumers from websites established outside the EU falls in the scope of the Cosmetics Regulation.
It should be noted that this guidance does not address:
- "Personal use" products which are bought outside the EU and brought back by individuals with no intention of selling them on return to the EU. Indeed, in this case, the European consumers cannot expect that the products comply with EU legislation.
- Selling cosmetic products in the EU from websites established in the EU[3]. In this case, it is clear that the Cosmetics Regulation applies.
Article 1 of the Cosmetics Regulation provides that:
"This Regulation establishes rules to be complied with by any cosmetic product made available on the EU market, in order to ensure the functioning of the internal market and a high level of protection of human health."
Therefore, the Cosmetics Regulation pursues three main objectives.
First, its main goal is to ensure that EU consumers have access to safe cosmetic products on the European market. Requiring cosmetic products sold over the Internet to European consumers from websites established in a third country to comply with the requirements of the Regulation is in line with this aim.
Second, the Regulation aims to ensure the smooth functioning of the internal market. Were the Cosmetics Regulation not to apply to products sold over the Internet by companies established outside the EU, this would lead to disruptions in the internal market. Indeed, Member States would develop different types of regulatory requirements and specific national controls of compliance with the legal obligations.
Third, the aim is also to guarantee that companies complying with the legal requirements of the Cosmetics Regulation do not suffer unfair competition from outside the EU. This is why the Cosmetics Regulation applies to companies established outside the EU selling cosmetics products in the EU. Allowing companies established outside the EU to target directly EU consumers via the Internet with products which do not satisfy the requirements established in the Cosmetics Regulation, could pose a serious risk of unfair competition. These companies would be able to sell cosmetics at a cheaper price because they do not have to fulfil the legal obligations imposed by the Cosmetics Regulation.
3. Is a cosmetic product sold to European consumers from a website established outside the EU placed on the EU market?
According to Article 2(1)( h) of the Cosmetics Regulation "placing on the market" is defined as "the first making available of a cosmetic product on the Community market".
- "Making available"
Based on an analysis of the elements of the definition of "making available on the market", it appears that a website established outside the EU which targets directly European consumers fulfils all of them.
"Any supply of a cosmetic product for distribution, consumption or use (…)"
This notion covers all types of transfers of a cosmetic product with the intention of distribution, consumption or use on the Community market. An Internet sale aims to provide cosmetics to European consumers. Therefore, this is a supply for consumption.
"(…) on the Community market (…)"
If the website targets European consumers (e.g. possibility to ship to the European Union, to order from the European Union, currency, language, etc.), it can be considered that it aims directly at the Union market because European consumers can order and receive the proposed product.
"(…) in the course of a commercial activity (…)"
The European consumer buys the cosmetic product over the Internet. In the definition, there is no mention of a commercial activity within the EU territory.
"(…) whether in return for payment or free of charge."
The product is considered to be supplied either when the physical hand-over or the transfer of ownership has taken place. This transfer can be for payment or free of charge, and it can be based on any type of legal instrument. Thus, a transfer of a product is considered to have taken place, for instance, in the case of sale, loan, hire, leasing and gift.
- "First"
According to the Guide to the implementation of directives based on the New Approach and the Global Approach ("Blue Guide")[4] the concept of placing on the market refers to each individual product, not to a type of product, and irrespective of whether it was manufactured as an individual unit or in series. Therefore, in the case of sales over the Internet, it would concern every product sold through the website.
It can be argued that, in the case of websites established outside the EU targeting directly EU consumers, these cosmetics are only "potentially" placed on the market because they are not placed on the market until a European consumer orders them. Given this specificity, it can be considered that the website has to comply with the legal requirements of the Cosmetics Regulation regarding the product as soon as the product is directed to European consumers (e.g. labelling), and that the other obligations (e.g. responsible person, notification) have to be fulfilled at the latest when the company selling its products over the Internet receives an order from a European consumer.
In conclusion, it can be considered that cosmetics sold over the Internet are placed on the Union market.
4. Legal consequences
In the Cosmetics Regulation, every actor has specific legal obligations. The basic rule requires that there be, within the Union, a person responsible for a cosmetic product sold in the EU market. Indeed, the responsible person within the Union has to comply with the legal obligations stemming from the Cosmetics Regulation (e.g. notification, labelling, safety issues).
This legal requirement is established in Article 4, more specifically, in paragraphs 1 and 2:
1. Only cosmetic products for which a legal or natural person is designated within the Community as ‘responsible person’ shall be placed on the market.
2. For each cosmetic product placed on the market, the responsible person shall ensure compliance with the relevant obligations set out in this Regulation.
For all the products placed on the market, there must be a responsible person. The reason for this requirement is to ensure that somebody is in charge of all the legal obligations stemming from the Cosmetics Regulation.
Where a website established outside the EU and targeting directly EU consumers sells cosmetics to an EU consumer, there is a direct Internet sale to this consumer. There is no intermediary, because there is no importer in the meaning of the Cosmetics Regulation. The consumer is the first person receiving a given cosmetic product in the EU. However, a consumer cannot be considered as the responsible person for this product. If the holders of websites established outside the EU and targeting directly EU consumers were not required to comply with the Cosmetics Regulation, this would mean there is no responsible person for that product.
Therefore, the conclusion of this analysis is that companies selling cosmetic products through Internet websites established outside the EU and directly targeting EU consumers need:
- to appoint a responsible person in the European Union;
- to follow the legal requirements of the Cosmetics Regulation.
[1] OJ L 342, 22.12.2009, p. 59–209.
[2] References to the Union in this Regulation shall be understood as including any other country with which the Union has concluded an agreement which confers on that country the same status as a Member State for the purpose of application of this Regulation.
[3] Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market ('Directive on electronic commerce') OJ L 178, 17.7.2000, p. 1–16; Article 2 point (c) "established service provider": a service provider who effectively pursues an economic activity using a fixed establishment for an indefinite period. The presence and use of the technical means and technologies required to provide the service do not, in themselves, constitute an establishment of the provider".
[4] Published by the European Commission (1999), see http://ec.europa.eu/enterprise/policies/singlemarket-
goods/files/blue-guide/guidepublic_en.pdf , in particular page 19.