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# 52013SC0066

**COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT ON THE ANIMAL TESTING PROVISIONS IN REGULATION (EC) 1223/2009 ON COSMETICS Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the animal testing and marketing ban and on the state of play in relation to alternative methods in the field of cosmetics /\* SWD/2013/066 final \*/**

  

TABLE OF CONTENTS

1........... Procedural issues............................................................................................................ 6

1.1........ First Phase of Stakeholder
Consultation on the Evaluation of the Availability of Alternative Methods     6

1.2........ Second Phase of Stakeholder
Consultation on the Impacts of the 2013 Deadline.............. 7

1.3........ Other contacts with stakeholders..................................................................................... 9

1.4........ Contacts with Third Countries......................................................................................... 9

1.5........ External studies............................................................................................................. 10

1.6........ Inter-Service steering group on
the impact assessment................................................... 10

1.7........ Follow-up to Impact Assessment
Board recommendations............................................ 10

2........... Problem Definition........................................................................................................ 11

2.1........ General Policy Context................................................................................................. 11

2.1.1..... Cosmetics sector.......................................................................................................... 11

2.1.2..... Cosmetics Regulatory Framework................................................................................ 14

2.1.3..... Previous Legislation in relation
to the Marketing Ban...................................................... 15

2.1.4..... Implementation of the 2009 Testing
and Marketing Ban and Impacts............................. 16

2.1.5..... Legal clarity in relation to the
scope of the testing and marketing ban.............................. 17

2.1.6..... Provisions in relation to Animal
Testing in other Union legislation.................................... 18

2.1.7..... Animal Testing Requirements for
Cosmetics in non-EU Countries.................................. 19

2.2........ Problem Description..................................................................................................... 20

2.2.1..... Animal Welfare............................................................................................................. 20

2.2.2..... Research into Alternatives to Animal Testing.................................................................. 23

2.2.3..... Consumer Safety.......................................................................................................... 25

2.2.4..... Consumer Choice and Product
Innovation..................................................................... 25

2.2.5..... The Competitiveness of the EU
Cosmetics Industry....................................................... 29

2.2.6..... Regional and Sectorial Impacts..................................................................................... 30

2.2.7..... Trade Impacts.............................................................................................................. 30

2.2.8..... Employment................................................................................................................. 31

2.2.9..... Specific Impacts on SMEs and
Micro-Enterprises......................................................... 32

2.3........ Subsidiarity................................................................................................................... 33

3........... Objectives.................................................................................................................... 34

3.1........ General objective.......................................................................................................... 34

3.2........ Specific objectives........................................................................................................ 34

3.2.1..... To maintain consumer safety and
consumer choice (specific objective 1 – Consumer Safety and Choice)          34

3.2.2..... To maintain innovation and
competitiveness of the European cosmetics industry (specific objective 2 –
Innovation and competitiveness)..................................................................................................... 34

3.2.3..... To provide animals with a high
level of protection and welfare (specific objective 3 - Animal Welfare)  35

3.2.4..... To maintain the incentive for
continued research on alternative methods to animal testing (specific objective
4 – Research into alternatives)............................................................................................. 35

4........... Policy Options.............................................................................................................. 35

4.1........ Option 1: Baseline/No Action....................................................................................... 35

4.2........ Option 2: Postpone the 2013
deadline........................................................................... 35

4.2.1..... Option 2 (a): Postpone the 2013
deadline with fixed deadline........................................ 36

4.2.2..... Option 2 (b): Postpone the 2013
deadline in relation to certain endpoints only and maintain for others  36

4.2.3..... Option 2 (c): Postpone the 2013
deadline without fixed deadline.................................... 36

4.3........ Option 3: Maintain the deadline
and introduce an additional derogation mechanism......... 36

5........... Analysis of Impacts....................................................................................................... 38

5.1........ Methodology and possible impacts
identified................................................................. 38

5.1.1..... Impacts Policy Option 1 -
Baseline/No Action.............................................................. 38

5.1.2..... Impacts Policy Options 2 (a), (b)
and (c) – Postpone the 2013 deadline........................ 39

5.1.3..... Impacts Policy Option 3 - Maintain
the deadline and introduce an additional derogation mechanism from the
marketing ban............................................................................................................... 40

6........... Comparing the options.................................................................................................. 44

6.1........ Comparing the options on
Effectiveness......................................................................... 44

6.2........ Comparing the options on
Efficiency.............................................................................. 45

6.3........ Comparing the options on
Coherence............................................................................ 45

6.4........ Preferred Option.......................................................................................................... 47

6.5........ Financing...................................................................................................................... 47

7........... Monitoring and evaluation............................................................................................. 47

Annex 1: Summary Second Phase Stakeholder
Consultation........................................................ 49

Annex 2: Numbers of Animals used for
Toxicological Testing....................................................... 52

Annex 3: The Need for Toxicological Data for
the Cosmetics Safety Assessment......................... 55

Annex 4: Testing Data Sources.................................................................................................... 57

Annex 5: Cosmetic Products and their Life
Cycle......................................................................... 59

Annex 6: Overview of Cosmetic Ingredients
Portfolio and Changes.............................................. 60

Annex 7: Glossary....................................................................................................................... 65

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT ON THE ANIMAL TESTING
PROVISIONS IN REGULATION (EC) 1223/2009 ON COSMETICS

Accompanying the document

COMMUNICATION FROM THE COMMISSION
TO THE EUROPEAN PARLIAMENT AND THE COUNCIL

on the animal testing and
marketing ban and on the state of play in relation to alternative methods in
the field of cosmetics

Disclaimer:

This Impact Assessment report only commits
the Commission's services involved in its preparation and does not prejudge the
final form of any decision to be taken by the Commission.

1.
Procedural issues

The Cosmetics Directive[1] foresees a phasing-out of
animal testing for cosmetic products. A ban of animal testing of finished
cosmetic products has been in force since September 2004 and a testing ban on
ingredients or combinations of ingredients since March 2009. As from March
2009, it is also prohibited in the EU to market cosmetic products and their
ingredients which have been tested on animals in order to meet the requirements
of the Directive, irrespective of the origin of these products. This marketing
ban applies to all but the most complex human health effects to be tested to
demonstrate the safety of cosmetic products (repeated-dose toxicity including
skin sensitisation and carcinogenicity, reproductive toxicity and
toxicokinetics), for which the legislator extended the deadline to March 2013[2].

The assessment of the 2013 marketing ban is
foreseen in the Cosmetics Directive itself. Article 4a (2.3) of the Cosmetics
Directive obliges the Commission to study the progress and compliance with the
implementation deadlines in relation to animal testing and to report to the
European Parliament and the Council. In particular, the Directive provides that
if alternatives to animal testing in relation to the endpoints covered by the
2013 marketing ban are not developed and validated by the 2013 implementation
date, the Commission shall inform the European Parliament and the Council and
put forward a legislative proposal.

The Commission has monitored the progress
of the development of alternative methods to animal testing on a yearly basis
and presented its final report to the European Parliament and the Council[3] on 13 September 2011. It
concluded that alternatives to animal testing in relation to the endpoints in
question will not yet be available by 2013.

1.1.
First Phase of Stakeholder Consultation on the
Evaluation of the Availability of Alternative Methods

The Commission services evaluated the
availability of alternative methods between April 2010 and May 2011. The
evaluation exercise aimed at gaining a broad and objective picture of the
scientific and technical issues related to establishing alternative test
methods for the human health-related effects falling under the 2013 deadline.
To this end the Commission services selected scientific experts proposed by the
various stakeholders. The work was carried out under the co-ordination of the
European Centre for the Validation of Alternative Methods (ECVAM)[4], hosted by the Institute for
Health and Consumer Protection of the European Commission's Joint Research
Centre.

In total 39 experts contributed, nominated
from amongst proposals received by Cosmetic Regulators (Member States as
represented in the Standing Committee operating under the Cosmetics Directive),
the Scientific Committee on Consumers Safety (SCCS), the European Cosmetics
Association (Colipa[5]),
the European Federation for Cosmetic Ingredients (EFfCI) and the European
Coalition to End Animal Experiments (ECEAE).

The draft expert report was open to public
consultation between 23 July and 15 October 2010. The consultation was
accessible on the Commission's "Your Voice in Europe" as well as
Directorate-General SANCO's cosmetics website[6].
Known stakeholders were in addition directly informed by e-mail and in
stakeholder meetings. The consultation was carried out in accordance with the Directorate-General
SANCO's "Code of Good Practice For Consultation of Stakeholders"[7]. The contributions of the
stakeholders, a summary report of the consultation as well as the final report,
are published on the Directorate-General SANCO's cosmetics website[8].

The large majority of stakeholders agreed
with the draft reports findings. Some stakeholders from the animal welfare side
considered the report as too conservative[9].
While they based themselves on the same alternative methods as those described
in the expert report, they considered that these methods could already today be
relied on for the safety assessment. However, the overall findings of the
expert report and the consultation do not support this view. The findings of
the expert report are also consistent with the findings of the SCCS[10] and with other evaluations in
relation to the availability of alternative methods carried out within the
Commission[11].
The expert report findings were overall also confirmed by an expert panel
review[12].

This technical and scientific analysis was
necessary in order for the Commission to be able to report to the European
Parliament and the Council on the availability of alternative methods.

1.2.
Second Phase of Stakeholder Consultation on the
Impacts of the 2013 Deadline

In order to obtain information on the
potential impacts of the entry into force of the 2013 deadline the Commission services
consulted targeted stakeholders and cosmetic regulators (Member States as
represented in the Standing Committee operating under the Cosmetics Directive)
between December 2010 and April 2011. The list of stakeholders consulted
included besides the cosmetic regulators the cosmetics industry, cosmetic
ingredient manufacturers, animal welfare organisations, a consumer
organisation, the Scientific Committee for Consumer Safety (SCCS), and trading
partners. The consultation document, as well as a list of stakeholders
consulted, is available on the Directorate-General SANCO's cosmetics website.
The contributions of the stakeholders to the targeted stakeholder consultation
are published on the same website[13].
The consultation was carried out in accordance with Directorate-General SANCO's
"Code of Good Practice For Consultation of Stakeholders"[14]. A summary of the consultation
is contained in Annex 1.

A targeted stakeholder consultation was
chosen as it was considered to be the consultation at the most appropriate
level to obtain the information required to assess the impacts of the 2013
deadline. This choice was confirmed by the large sample size on which the
industry input was based. The Colipa submission was based on input from 24
large and 100 small companies, while in a public consultation carried out in
2007 in relation to the revision of the Cosmetics Directive[15] a total of 47 industry
stakeholders replied.

The consultation document outlined the
option to postpone the deadline (including sub-options, such as postponing for
certain endpoints only, and the possibility to have no fixed cut-off date) and
the option to maintain the deadline irrespective of availability of
alternatives (thus not to make a proposal). It included a questionnaire that
was aimed at obtaining data to allow the Commission services to assess the
likely impacts of the 2013 marketing ban.

As a result of the input received an
additional option was added to the considerations by the Commission, the
introduction of a derogation mechanism. The targeted stakeholder consultation
was therefore followed up and further detailed in relation to the derogation
option (Option 3, below 4.3) through bilateral consultation with stakeholders
and through detailed presentations in the Cosmetics Committee and Working Group
on 9 November 2011 and 23 March 2012. In these meetings, as well as in several
bilateral meetings, the details of the derogation option were described to
stakeholders and discussed. All stakeholders that were part of the targeted
consultation were provided with an outline of the derogation and had the
opportunity to comment.

In the overall debate all stakeholders
support the long term objective to replace animal testing for cosmetics. Animal
testing is a tool to ensure consumer safety but has in itself no specific
interest or value for the stakeholders involved. The question at stake is therefore
how to deal with the situation until alternative methods become available.
Here, the stakeholder consultation showed diverging views as to the expected
impacts of the entry into force of the 2013 marketing ban and the best way
forward. Industry, several Member State Competent Authorities (Czech Republic,
Denmark, France, Germany, Greece, Italy and Poland) and the SCCS expected
significant negative impacts on the availability of cosmetic ingredients and
products, the competitiveness of the cosmetics industry and on employment. They
considered an extension of the deadline the most logical way forward. Animal
welfare organisations and some Member State Competent Authorities (Austria and
Sweden) by contrast considered that the bans were based on an ethical decision,
that possible negative economic and social impacts play no role in the
decision-making and were clearly opposed to any change in the deadline. They
considered that in any case such impacts were unlikely as manufacturers could
rely on existing data and ingredients.

Some stakeholders, in particular Colipa,
EFfCI and ECEAE, collected data from their members for a consolidated
submission of their respective organisation to the consultation. When this data
is relied on in the following impact assessment, reference is made to the
respective data (Colipa data[16],
EfFCI data, ECEAE data based on companies taking part in the Leaping Bunny[17]).

The input and data received in this
consultation is one of the main pillars of the following assessment and
reference is made to the received data throughout the assessment.

Stakeholders were in addition informed and
consulted in the framework of regular meetings of the Standing Committee and
the Working Group[18]
on Cosmetics. Targeted meetings took place at senior level with representatives
from industry associations and animal welfare organisations on various
occasions.

1.3.
Other contacts with stakeholders

Since the beginning of its assessment, the
Commission services have received a large amount of e-mails, faxes and letters
from citizens requesting it to maintain the 2013 deadline. A petition of one of
the animal welfare organisations alone resulted in 350 000 signatures in favour
of maintaining the ban[19].
The European Parliament's Intergroup on the Welfare & Conservation of
Animals[20]
also called for no extension to the deadline.

1.4.
Contacts with Third Countries

The Commission services work actively with
its counterparts from the United States, Japan and Canada in the framework of
the "International Cooperation on Cosmetic Regulation" (“ICCR”).
Animal testing has been a key issue for ICCR since its inception. In this
context, the International Cooperation on Alternative Test Methods (ICATM)
started in September 2008, was implemented in April 2009 and has in the
meantime become well established. ICATM members cooperate actively on the
validation of alternatives and provide regular reporting to the ICCR. The
targeted stakeholder consultation document was sent to ICCR partners, however
no input was received. This may have various reasons, from not having specific
data to provide to political reasons. In the first phase of consultations a
reaction from the United States Food and Drug Administration (FDA) was
received.

The issue has also been raised in the
framework of bilateral contacts by the Commission, such as with Chinese
authorities, who submitted their support for a postponement of the 2013
deadline in the framework of the targeted stakeholder consultation. China has
over the last years overhauled its cosmetics legislation and requires in many
instances animal testing data for the cosmetics safety assessment.

1.5.
External studies

For the preparation of this impact
assessment no specific external studies have been mandated, as it was
considered that an external contractor would not have had access to additional
data and would have consulted the same stakeholders. In addition, the recent
revision of the Cosmetics legislation, which led to the adoption of Regulation
1223/2009/EC[21],
was preceded by an extensive impact assessment[22].
The Commission services took the data generated in that context and in
particular the RPA study "Impact of European Regulation on the EU
Cosmetics Industry" of September 2007[23]
and the work done by Global Insight "Study of the European Cosmetics
Industry" of October 2007[24]
into account for this assessment. For some of the data in these two reports the
targeted stakeholder consultation provided updated or more accurate data.

1.6.
Inter-Service steering group on the impact
assessment

Commission inter-service steering group
meetings took place at the different stages of the assessment (20 July 2010, 21
September 2010, 23 June 2011 and 3 February 2012). The following
Directorate-Generals were invited and regularly informed of the progress of the
assessment: DG ENV, DG ENTR, DG RTD, DG TRADE, DG MARKT, SG, LS, BEPA and JRC.

1.7.
Follow-up to Impact Assessment Board
recommendations

The Impact Assessment Board issued its
Opinion on 25 May 2012 (Reference 2011/SANCO/025). On the basis of this opinion
the final report was adapted, in particular in line with the Board's
recommendation to:

·
Improve the presentation of the problem;

·
Better explain the options;

·
Strengthen the assessment of impacts;

·
Improve the comparison of options;

·
In relation to procedure and presentation, to
better present the stakeholder's different views.

A number of more technical comments made by
the Board were equally taken into account and the draft report was adapted
accordingly.

2.
Problem Definition
2.1.
General Policy Context
2.1.1.
Cosmetics
sector

Cosmetics range from everyday hygiene
products, such as soap, shampoo, deodorant and toothpaste to luxury beauty
items including perfumes and decorative cosmetics.

The European Cosmetics and Toiletries industry
recorded a total retail sales price of EUR 71.8 billion in 2010[25]. These figures are based on
more recent Euromonitor data provided by the cosmetics industry than the one
provided to the targeted stakeholder consultation. There the market was
estimated at EUR 66.6 billion This represents almost half of the global market.
The market is led by Germany and France, followed by the United Kingdom, Italy
and Spain. These five Member States make up 69% of the total retails sales
price, the remaining 31% are shared between two groups of Members States, those
with a turnover ranging from EUR 800 to 999 and those between 1 000 to 3 000
billion.

The cosmetics industry
is composed of five main sub-sectors and market segments that can be
distinguished as follows:

The two main segments, i.e. the skin care
and toiletries segment, account for around 52% of the total market. The
segments hair care, fragrances and decorative cosmetics cover the remaining
market share of 48%. Almost all segments, especially decorative cosmetics and
toiletries products, recorded a positive growth over the past years.

The structural conditions of the European
industry are on the one hand characterized by multinational conglomerates.
There are a significant number of major international cosmetic firms in Europe,
mainly in France and Germany. The leading companies are L'Oreal, Beiersdorf,
Henkel, Procter & Gamble, Unilever, Johnson & Johnson, Sara Lee and
Colgate. European leader is the French company L'Oréal, which is also the
world's leading cosmetics manufacturer. Large companies are estimated to have a
market share of about 70%. On the other hand the clear majority of companies in
number in the cosmetics field are small- and medium-sized companies (SMEs),
with several hundred of them in most Member States[26].

Overall, the EU cosmetics industry
comprises approximately 4 576 companies, including over 4 072 SMEs[27]. It is estimated to directly
employ more than 184 000 people, indirect employment of retail and beauty
salons is estimated to about 1.7 million employees[28].

Many of the SME's in the Cosmetics and Toiletries
industry have fewer than 10 employees and thus qualify as microenterprises. For
example, there are an estimated 855 firms with fewer than 10 employees in
France and Italy.

Extra community exports of cosmetic
products from the EU totalled EUR 12.4 billion in 2010, with France and Germany
being the largest exporters. Exports play a particularly important role for
larger cosmetic manufacturers, as well as for cosmetic ingredient
manufacturers. Exports clearly outweigh imports within the Cosmetics market.

The European Cosmetics & Toiletries
market faces new challenges in the highly competitive global market. There is increased
competition and simultaneously potential growth in the overall saturated global
market from emerging markets. China's premium cosmetics market is for example
expected to double by 2015 to reach $7 billion and Latin America’s industry
value in 2015 is expected to be the third largest globally.

The innovation potential of Europe's
Cosmetics and Toiletries market is highly important for trade and growth. Product
innovation is a major driver for growth of the cosmetics industry in the EU;
several thousand new or improved products are placed on the market each year
with major companies, on average, reformulating or replacing around 25% of
their cosmetics products annually[29].

Patent activity is one indicator for
innovation. The cosmetics industry is responsible for a large part of the
overall patent activity in the EU, with a total of 6 082 patents filed in 2011,
compared to a volume of 6 438 inventions in 2010. While there was a growing
demand for patent protection in relation to ingredients for cosmetics and
perfumes, with a steep increase since 2000[30],
there is a decline of 6% between 2011 and 2010.

The sectors with the highest patent volume
remain, despite a general decline in all subsectors with the exception of
antiperspirants, hair, make-up, skin antiperspirant and perfumes.

Ingredients play the key role in product
and technology innovation in cosmetics and perfumes, and are consequently the
focus of significant patent activity. Ingredients and extracts for cosmetics
and perfumes may be drawn from a variety of sources, including synthetic
compounds, botanicals or minerals, such as mica used to add sheen and glitter.
Among the main European players for patent assignees for extracts and
ingredients is L’Oreal, followed by Unilever, Henkel and Beiersdorf. As regards
the range of materials and technologies involved in patent applications for the
cosmetics and perfumes sectors peptides play an important role, but
biochemistry and more recently emerging areas such as nanotechnology play a
role as well. Often fields referenced in cosmetics patents are also referenced
in the pharmaceutical field.

2.1.2.
Cosmetics
Regulatory Framework

The Cosmetics Directive 76/768/EEC is the
regulatory framework for the placing on the market of cosmetic products. Its
key objectives are to ensure consumer safety and to secure an internal market
for cosmetic products. It is based on manufacturer responsibility for the
safety of products. For certain ingredients - colorants, preservatives and
UV-filters - only ingredients included in positive lists (Annexes IV, VI and
VII to the Cosmetics Directive) can be used. Also, a large number of
ingredients are either prohibited or restricted (Annexes II and III) and
manufacturers need to take account of this in their product formulation.
Inclusion in the Annexes is preceded by a scientific risk assessment by the
Scientific Committee.

In order to ensure the safety of products manufacturers
must carry out a safety assessment, which includes a study of the intrinsic
properties of all ingredients contained in the product. A number of key
endpoints need to be addressed, such as whether the ingredient can cause
allergies or whether it otherwise causes damage to the human body as a result
of repeated use, such as cancer. To assess these questions currently animal
testing data is often relied on. The testing to obtain such data does not have
to be carried out by the manufacturer - in many cases such safety data is
available upstream from the ingredient manufacturer or through other data
sources. Testing does not need to be carried out for each batch or each
product, it is sufficient to have determined the profile of an ingredient once.
Such testing would typically be carried out relatively early on in the product
development, in most cases around 2 to 3 years before the product actually
reaches the market. Testing must comply with the principles of good laboratory
practice[31]
and follows defined testing protocols set out in Council Regulation (EC)
440/2008[32]
and in most cases based on OECD Testing Guidelines. Whether animal testing data
is relied on or not becomes evident in the manufacturers safety assessment –
which needs to be documented and kept available to the authorities.

The Cosmetics Directive aims at phasing out
animal testing for cosmetic purposes. Besides the complete testing ban
for cosmetic products and their ingredients, a marketing ban has applied
since 11 March 2009 for all human health(-related) effects with the exception
of repeated-dose toxicity (including skin sensitisation
and carcinogenicity), reproductive toxicity and
toxicokinetics, for which the deadline is 11 March 2013. As a result no testing
for cosmetic purposes can be carried out inside the EU, but for the endpoints
covered by the 2013 deadline testing can be carried out outside the EU and the
results of tests performed before that date can be relied on in the safety
assessment. There is a possibility for Member States to request a derogation
from these provisions in case a human health problem is substantiated for an
ingredient that is in wide use and cannot be replaced by another ingredient
capable of performing a similar function.

The provisions in relation to animal
testing were not changed by the recast of the Cosmetics Directive by Regulation
(EC) 1223/2009. The Cosmetics Regulation did
however further strengthen the requirements for the safety assessment and will
thus rather lead to an increased need for toxicological data. It also
introduced specific provisions for nanomaterials, requiring manufacturers to
inform the Commission about the toxicological profile and the safety data of
the material before placing the cosmetic product on the market. The Cosmetics
Regulation repealing the Cosmetics Directive as of 11 July 2013, any proposal
would amend the Cosmetics Regulation only.

2.1.3.
Previous
Legislation in relation to the Marketing Ban

The first provisions in relation to the
marketing ban of cosmetic ingredients or combinations of ingredients tested on
animals in order to meet the requirements of the Directive were introduced to
the Cosmetics Directive by Directive 93/35/EEC[33] with an
application date of 1 January 1998. The introduction of the marketing ban was
based on the political objective to end animal testing for cosmetics. The '3R'
principle – aiming to replace, reduce and refine animal testing wherever
possible – had earlier on been integrated in Directive 86/609/EEC[34]. The introduction of the ban
at the time was not based on a science based assessment that alternative
methods would be available by 1998. Indeed, the European Centre for the
Validation of Alternative Methods (ECVAM) had only been founded in 1992 and no
validated alternative methods were in place yet. The provisions foresaw that,
in case alternative methods would not be available in time, the Commission
would propose the postponement of the ban by 1 January 1997 for no less than 2
years.

The ban was postponed for the first time
by Commission Directive 97/18/EC[35]
to June 2000, essentially stating that alternative methods were not yet
available and that the scientific developments were difficult to foresee, but
that given the need of close follow-up of the issue the next scientific
re-assessment should not be pushed out too far.

The second postponement was an
interim Commission measure. In 2000 the Commission had already made the
co-decision proposal that eventually lead to Directive 2003/15/EC[36], the third postponement. But
it was clear that this proposal would not be adopted before the lapse of the
deadline in 2000. The Commission therefore proposed by Commission Directive[37] to postpone the deadline until
30 June 2002. Directive 2003/15/EC, the third postponement which sets the
current deadlines, was adopted in February 2003.

With the proposal for Directive 2003/15/EC
the Commission intended to move from a marketing to a testing ban, first for
products and later for ingredients. It also proposed to postpone the entry into
force of the testing ban for ingredients in the absence of alternatives. These
changes were proposed in order to address enforcement difficulties and the
unavailability of alternative methods. However, in the co-decision procedure
the testing and marketing ban were both imposed and the 2009 deadline for the
full testing ban and the partial marketing ban was clearly made independent of
alternatives being available.

A number of elements are therefore
different in the situation under consideration now compared to the earlier
postponements. These are:

·
The European Parliament and the Council made it
clear that it is willing to set fixed cut-off dates, even in the absence of
alternatives. The testing and part of the marketing ban accordingly apply since
2009 in the absence of alternatives with respect to some endpoints;

·
The European Parliament and the Council made it
clear that a constant review process with postponements by the Commission is
not the acceptable way forward and did not provide this right to the Commission
in Directive 2003/15/EEC (any change now requires co-decision);

·
Considerable progress has been made in the
development of alternatives since 2003. The extensive expert review carried out
in the above described first phase of stakeholder consultation made it however
also clear that for most endpoints covered by the 2013 deadline it will take at
least 10 years and most likely more to fully replace animal testing. This puts
the overall policy approach of recurrent postponements in question.

One of the options considered in this
assessment is a postponement similar to the ones before (see option 2 (a)
below). However, as described above, the current situation does not necessarily
require the same policy response as before.

2.1.4.
Implementation
of the 2009 Testing and Marketing Ban and Impacts

The implementation and enforcement of the
testing and marketing ban is the responsibility of Member States. The
Commission annual reports[38]
cover certain aspects of the implementation and enforcement. They address the
availability of alternative methods and the progress in research, the number of
animals used in the EU for testing until the 2009 ban entered into force and
technical difficulties in complying with the bans. Endpoints falling under the
2009 deadline of the marketing ban are: skin corrosivity, skin irritation,
dermal absorption, phototoxicity, mutagenicity/genotoxicity, acute toxicity and
eye irritation. Not all endpoints falling under 2009 can be fully replaced by
alternative methods yet. For the last three endpoints full replacement is not
yet possible, respectively limitations exist. The 2009 marketing ban applies
irrespective of this unavailability and appears not to have caused major
negative impacts so far. The Commission services are not aware of products
being taken from the market by Member State authorities as a result of the
marketing ban and the stakeholder consultation did not result in concrete
information on negative impacts, even though this question was raised.
Nevertheless the Commission services are faced with first cases in which the
SCCS cannot provide a conclusive opinion on the safety of a substance as data
on the 2009 endpoints is missing or not sufficient for the assessment. These
situations are expected to become more frequent.

Impacts of the 2009 ban are therefore not
excluded and the fact that not many were reported so far in no way prejudices
the possible impacts of the 2013 deadline. A number of elements have to be
taken into account here:

·
Since the animal testing data is needed at the
early stage of the product development, any impacts would most likely become
more evident later. The deadline was known and industry prepared;

·
The endpoint acute toxicity plays in practice a
limited role for the cosmetics industry. Ingredients used in this sector
essentially do not raise the risk of acute toxicity and sufficient information
is often available from repeated dose studies;

·
As regards mutagenicity/genotoxicty alternative
tests are available, but come with some drawbacks in that they appear to be
oversensitive. However in many cases they will be sufficient to exclude certain
properties;

·
As regards eye irritation, again some judgements
can be made using existing alternative approaches, eg. existing alternatives
provide the possibility to eliminate severe irritants;

·
Another aspect why the 2009 deadline has
apparently not had negative impacts is the uncertainty in relation to the
interpretation (see below under 2.1.5.).

These elements also explain why the
derogation for Member States has only been requested one time so far.

2.1.5.
Legal clarity
in relation to the scope of the testing and marketing ban

The current provisions on animal testing
have been subject to diverging interpretations by different stakeholders.
The main discussions on the scope centre on the wording used in the testing as
well as the marketing ban "in order to meet the requirements of this
Directive".

Starting point for the discussion is the
fact that the majority of ingredients used in cosmetic products are ingredients
that are equally in use in many other consumer and industrial products, such as
in pharmaceuticals, detergents and food, and animal testing may be necessary to
ensure compliance with the legal frameworks applicable to these products.
Ingredients used in cosmetics will generally also be subject to the horizontal
REACH[39]
requirements and animal testing may be necessary as a last resort to complete
the respective data packages.

Shortly after its adoption, the relevant
provisions of Directive 2003/15/EC were challenged by the French Republic before
the European Court of Justice in case C-244/03. However, the case was held
inadmissible. Currently, there is no jurisprudence of the Court of Justice of
the European Union ('the Court') on the interpretation of the scope of the 2013
marketing ban. Only the Court can provide a legally binding interpretation of
Union law. The Commission services role is to oversee, under the control of the
Court, the application of the provisions by Member States.

The Commission services consider that data
from animal testing generated before the respective deadlines can be used
and relied on after the deadline and do not trigger the marketing ban.

The Commission services also consider that
animal testing that has clearly been motivated by compliance with non-cosmetics
related legislative frameworks should not be considered to have been carried
out 'in order to meet the requirements of this Directive/Regulation'.
The resulting animal testing data should not trigger the marketing ban and
could subsequently be relied on in the cosmetics safety assessment.

Independent of the option chosen, it is necessary
to provide clarification on the interpretation in order to ensure a coherent
application of the legal framework by Member States and to provide a
clear and predictable legal framework for the economic operators.

2.1.6.
Provisions in
relation to Animal Testing in other Union legislation

The protection and welfare of animals is an
area covered by a wide range of Union legislation. It is covered by Article 13
of the Treaty on the Functioning of the European Union, which requires the
Union and Member States to pay full regard to the welfare requirements of
animals when formulating policies. Prior to that, the issue was addressed in a
Protocol to the Amsterdam Treaty.

Already in 1986 the EU introduced specific
legislation covering the use of animals for scientific purposes, Directive
86/609/EEC. In September 2010 Directive 2010/63/EU[40] was adopted, which updates and
replaces the existing legislation. The aim of the new Directive is to
strengthen the legislation and to improve the welfare of those animals still
needed to be used, as well as to firmly anchor the principle of the '3Rs',
to replace, reduce and refine the use of animals, in Union legislation.
Directive 2010/63/EU has taken full effect since 1 January 2013. Member States
must accordingly ensure that, wherever possible, a scientifically satisfactory
method or testing strategy, not entailing the use of live animals, is used
instead of animal testing. If replacement is not possible reduction and
refinement have to be ensured.

Toxicological data requiring animal
testing is needed under many pieces of Union legislation for the regulatory
safety assessment. This is for example the case
under REACH[41]
for chemical substances, which are a major ingredient source for cosmetics. REACH
has several provisions in place to reduce animal testing for its purposes. It requires
companies to share data in order to avoid unnecessary animal testing. If
testing is needed and depending on the tonnage a testing proposal must be
submitted to the European Chemicals Agency. Under REACH, animal testing is to
be avoided in favour of alternative methods and registrants can only carry out
tests involving the use of animals as a last resort. Similarly, the proposal
for a new Regulation on Biocides[42]
will require toxicological data including animal data, but animal testing is
allowed as a last resort only and data sharing is required.

In summary, Union legislation recognises
that animal testing is still needed to ensure the protection of human health
and the environment and thus acknowledges that animal testing will be carried
out to fulfil the legislative requirements. Union legislation at the same time
sets very high animal welfare standards for such testing and requires that
whenever possible this testing is replaced, reduce and refined. The
Cosmetics legislation is the only legislation that prohibits animal testing
irrespective of the availability of alternative methods.

2.1.7.
Animal Testing
Requirements for Cosmetics in non-EU Countries

In the United States cosmetics are
regulated by the Federal Food, Drug & Cosmetics Act, which prohibits the
use of any unsafe substance in a cosmetic product. There is no list of
toxicology test methods for use in determining the safety of cosmetic ingredients
and cosmetic products. It is the manufacturer who is under an obligation to
verify whether the cosmetics he places on the market present any risk to
consumer health, but it is up to him to decide on the data (literature, tests
on animals or humans, alternative tests etc.) used as the basis for proving
harmlessness. Otherwise the product must bear the statement ‘The safety of this
product has not been determined’. New active ingredients in Over-The-Counter
(OTC) products (anti-acne, anti caries/anti-plaque, anti-hair loss,
anti-dandruff, anti-perspirant products, skin whiteners, sun protection
products etc.) must prove their safety on the basis of tests on animals and
also clinical tests.

The United States, while not prohibiting
animal testing, are also working towards the '3R's'. In 1997, the United States
created the Interagency Coordinating Committee on the Validation of Alternative
Methods (ICCVAM) to reduce animal testing. Once ICCVAM recommends that an
alternative method has been adequately validated and the relevant test
recommendations are accepted or endorsed by Federal regulatory and other
agencies, it becomes available for all toxicology purposes in the United
States.

In Japan a number of products that are
qualified as cosmetics in the EU are qualified as quasi-drugs. Quasi-drugs
include hair dyes and decolourants, anti-hair loss products, hair
permanents/straighteners, depilatories, anti-perspirants, deodorants,
anti-acne, skin whiteners, bath treatment products, medicinal cosmetics such as
anti-dandruff shampoos etc. and are subject to the regulations on
pharmaceutical products. A toxicological dossier is required for approval of a
new quasi-drug ingredient, including tests for which no alternatives are in
place yet. The Act on Welfare and Management of Animals was revised in 2006
incorporating basic　consideration　for　animal testing, handling of animals and introducing the '3Rs' principle. Japan also set up the
Japanese Centre for the Validation of Alternative Methods (JaCVAM) in 2005.

In China, the control of cosmetic
products and new cosmetic ingredients is since 2008 under the responsibility of
the Chinese State Food and Drug Administration (SFDA). For
finished cosmetics, depending on the type of product, a hygiene license or record-keeping
certificate from the Health Administrative Department of the State Council is
required. The hygiene license would for example be required for hair dye or sun
protection products or for deodorants. Obtaining the hygiene license requires a
testing report from a cosmetics testing institution approved by the SFDA, including
animal data. China is starting to consider the acceptance of alternative
methods.

In conclusion, animal testing data will in
many cases be needed to ensure the safety of cosmetic products internationally.
If alternative methods are available these will often be acceptable, however
levels of acceptance vary between countries. Notably methods included in OECD
Test Guidelines will often be accepted.

2.2.
Problem Description

According to the expert report on the
availability of alternatives (see 1.1), alternative methods to fully replace
animal testing for the endpoints covered by the 2013 deadline will not be
available by 2013. No specific timeline could be estimated in the areas of
toxicokinetics, repeated-dose toxicity, carcinogenicity and reproductive toxicity
due to the underlying scientific challenges. The timelines estimated for full
replacement of animal tests in the area of skin sensitisation pointed to a
further 7-9 years (i.e. 2017-2019) for scientific development. Another 3 to 6
years are likely to be needed for validation and regulatory acceptance of the
alternative methods. However, alternative methods able to simply discriminate
between skin sensitisers and non-sensitisers are expected to become available
earlier.

The problem is therefore in a nutshell that
the marketing ban would apply as of 11 March 2013 in the absence of alternative
methods, thus effectively limiting the tools needed for compliance with the
Cosmetics Regulation. This would have several consequences:

2.2.1.
Animal Welfare

The entry into force of the marketing ban
in 2013 would be positive in relation to animal
welfare, in that it would end animal use for EU cosmetic purposes. This was
the objective of the provisions when they were first introduced in 1993. This objective was based on overall ethical
considerations and not on animal numbers. Nevertheless animal numbers are an
important indicator of the impacts of the 2013 bans on animal welfare.

Since 11 March 2009, animal
testing for cosmetic purposes is no longer allowed in the EU. In the reports under the Cosmetics Directive the number of animals
used for cosmetic purposes in the EU were highest in 2004 with 8 988 animals
and came down to 1 510 in 2008 and 344 in 2009. Animals used for testing
for cosmetic purposes include rats, mice, guinea-pigs and rabbits. Any animal testing currently done for EU
cosmetic purposes is done outside the EU. Animals spared would therefore be
animals of these species outside the EU. Annex 2 provides further data on
animal use.

Currently, toxicological animal data is
still needed for the cosmetics safety assessment. Whether or not
ingredients can be used in cosmetic products depends on whether their safety
can be demonstrated. Toxicological data needs arise in two scenarios, the
manufacturers own safety assessment and the review by the SCCS, either with a view to the ingredient being added to
one of the positive lists or to being prohibited or restricted in use. The
highest data need for cosmetic manufacturers exists for skin sensitisation
tests, second for repeated dose, third for reproductive toxicity and then for
toxicokinetics and carcinogenicity. Information on the need for toxicological
data for the cosmetics safety assessment is included in Annex 3.

Over the last ten years large cosmetics companies
together carried out on average 213 animal tests for the 2013 endpoints per
year, out of which 151 addressed skin sensitisation and 36 repeated dose, thus
these two endpoints represent 87% of all testing[43]. For all of these endpoints
the complete replacement of animal tests is not yet possible.

These figures relate to testing carried out
for cosmetic purposes. By far not all testing data relied on for the
cosmetics safety assessment has been generated for this purpose. The data
used so far for the cosmetics safety assessment is indeed in many cases not
generated specifically for this purpose. About 90% of ingredients are used in
other areas as well. In many cases testing data is provided by the ingredient
supplier, who offers the ingredient also for other purposes. Testing data may
also be available in
publications, databanks, etc. Often the original reason for the testing will
not be obvious from the testing data itself. Information on testing data
sources is contained in Annex 4.

Large cosmetics companies considered
testing data from food, cosmetic products outside the EU and REACH as most
important to them[44].
This does not necessarily indicate that this data is available in most cases,
as the question was only how important it is considered to be, not in how many
cases it was available. However, while there remains uncertainty, it is likely that the importance given also
reflects the availability.

As regards the possible total number of animals
used outside the EU for EU cosmetic purposes that could be spared as a result
of the implementation of the 2013 marketing ban, there is no reliable
statistical data. Simply taking EU numbers before the bans as a baseline
does not work because 1) in a number of Member States testing for cosmetic
purposes was banned before the EU ban (eg. in the United Kingdom in 1998), 2)
many manufacturers already moved outside the EU for testing many years ago and
3) older animal numbers can not really give a reliable baseline as some of the
tests that where still carried out 10 years ago were using more animals and
might now not be needed as such.

While there are no reliable statistics, the
information supplied by stakeholders in the targeted stakeholder consultation
allow a reasonably solid estimate.

On the one hand, industry contributors
confirm that tests were already done outside EU, also ahead of the 2009 testing
ban deadline in the EU. About 90% of the testing for cosmetics took place
outside the EU in 2008[45].
Given that testing inside the EU for cosmetic purposes in 2008 was at 1 510
this would indicate about 13 590 animals were used outside the EU in 2008.
Since after 2009 all testing for cosmetics purposes has to take place outside
the EU, around 15 000 animals are likely to be used. Large cosmetic companies
carried out in 2010 185 tests for 2013 endpoints using a total of 7 732
animals. They indicated that over the last ten years they carried out in
average 213 tests per year. SMEs reported 8 tests in 2010 and a total of 160
animals and a yearly average of 7 tests over the last 10 years[46]. Taking into account that in
addition testing is also done or commissioned by ingredient manufacturers, this
data suggests that the overall estimate of a minimum of 15 000 animals
used outside the EU for EU cosmetic purposes per year is reasonable.

On the other hand, animal welfare
organisations provided an estimate for 2005, according to which 58 339 972
animals are used in actual animal testing procedures outside the EU annually[47]. Assuming that the percentage
of cosmetics testing in relation to the overall testing would be the same as
inside the EU, the respective animal welfare organisation estimates that
about 26 836 animals were used for cosmetics testing in 2005 worldwide. This
estimate relates to cosmetics specific testing. In contrast to the information
supplied by industry above, this information does however not specifically
relate to cosmetic specific testing done for EU cosmetic purposes, which
could explain why the estimate is higher than the industry figures.

Overall the data provided indicates that between
15 000 and 27 000 animals are used for EU cosmetics specific testing outside
the EU yearly.

These figures remain comparatively
limited in relation to the overall number of animals used in the EU for
experimental purposes per year (about 12 million)[48] .

However, not all of these 15 000 to 27 000
animals per year would be spared once the 2013 marketing ban comes into force.
Cosmetic specific testing outside the EU may be for two reasons at the same
time. One is testing for non-EU cosmetics regulatory requirements. While
the EU is working with trading partners in order to accelerate acceptance of
validated alternative methods, it is unlikely that other countries would
ban testing irrespective of the availability of alternatives or even
accept alternative methods for regulatory purposes to the same extent as the EU
in the short term. The other important reason for testing outside the EU is testing
to meet the EU cosmetics requirements.

There is no reliable data that would allow
determining exactly which part of the testing outside the EU is carried out for
EU cosmetics purposes only and would not take place beyond 2013. Testing
is often carried out at the supplier level to establish the safety dossier of
an ingredient, without specifically targeting only a certain market. Equally,
testing carried out by international cosmetic companies will be geared at
establishing the safety of the ingredient, but not necessarily only with a view
to a specific market. Testing carried out in line with OECD Test Guidelines can
be relied on then in all OECD countries and beyond.

To which extend testing outside the EU would
diminish as a result of the ban depends largely on business decisions of
companies. It concerns cases in which the data is needed to ensure the
safety of the product and cannot be obtained through alternative methods. In
the EU the ingredient could therefore not be used. Essentially the question is
whether a cosmetics company would forego the testing for third countries in
these cases. This depends on several criteria and strategic decisions of
companies and manufacturers, e.g. how important the ingredient for
manufacturers or companies is; how profitable it is to invest in a certain test
(animal testing can be costly, from EUR 4 000 for a skin sensitisation test to
about EUR 780 000 for a carcinogenicity test[49]),
whether or not the manufacturer considers that the non-EU market alone warrants
the investment or if the company considers a possible shift of investment into
other non-EU markets.

Due to these underlying uncertainties
making further assumptions (such as all animals currently used would be spared,
versus none of them or a certain percentage of them) will not lead to a more
reliable estimate. In addition, the exact number of animals spared is likely to
play a limited role for the political decision-making. Animal welfare
stakeholders recognise that the number of animals used for cosmetics is
comparatively low, but consider that the question is one of principle. For the
purposes of this impact assessment it is therefore considered that a sub-set
of the 15 000 to 27 000 will be spared.

The ban would have no immediate positive
impacts in relation to the number of animals used in other sectors overall
in the EU for the respective 2013 endpoints, which amounted in 2008 to 257 350
animals[50]
and was estimated by animal welfare stakeholders to be 134 180 in 2005 outside
the EU. In the absence of alternative methods animal testing will still need to
be carried out to comply with other applicable legislative frameworks. On the
longer run, the marketing ban in the Cosmetics Directive is expected however to
also have kick-off effects on the use of animals in other sectors. Alternative
methods developed in the cosmetics context can and are used to replace animal
testing in other sectors as well and vice-versa. All methods validated
and accepted at regulatory level are included in Commission Regulation (EC)
440/2008, and not specifically in Annex IX to the Cosmetics Directive. Also,
while the Cosmetics Directive only looks at replacement, the path to developing
a full replacement often leads first to refinement and reduction and thus
already benefits animals.

As mentioned, the number of animals used is
not the sole indicator of animal welfare: the existing provisions represent a
clear political and ethical choice to value animal welfare higher than
economic and “lifestyle” driven interests. They result from many years of very
engaged public and political discussions, going back more than 20 years.

Most information on public opinion in
relation to animal testing for cosmetics was presented by the animal welfare
organisations in the framework of the targeted stakeholder consultation. The
information provided indicates that, depending on the poll, between 60 and
88% of the citizens favoured a complete ban on animal testing for cosmetics.
A 2009 "You Gov" poll showed that 79% of respondents were against
testing that does not relate to serious or life-threatening human conditions.

A Eurobarometer[51] study showed that the majority
(66%) of respondents find that scientists should be allowed to do research on
animals, like mice, if it produces new information about human health problems,
while only 18% of respondents disagree. However, the purpose of the testing
is critical for the decision.

The overall long-term objective to end
animal testing for cosmetics is shared by all stakeholders. Stakeholders have
no interest in animal testing as such, other than as a tool to ensure and
demonstrate consumer safety. Indeed alternative methods may turn out to be
beneficial for industry. A recent example of an ECVAM validated method to address
in vitro carcinogenicity testing – while it only presents a partial
replacement - shows that the costs of the alternative (EUR 12 000 to 35 000 per
substance) were low in comparison to the animal test (EUR 1 to 1.5 million per
substance). With 2-7 weeks required per substance compared to 3 years in the
animal test the alternative would also be faster.[52]

Stakeholders hold however diverging
views on the impacts of the ban on animal welfare.
Animal welfare groups consider the effects on animal welfare to be very high
and point also to the kick-off effects for other sectors. They underline that
actual numbers are in any case not decisive for their view, but the underlying
basic ethical decision against animal testing. Industry stakeholders point out
that the overall number of animals to be saved is very small in relation to
overall animal use for scientific purposes. They also consider that the animal
use would continue for outside EU use in any case.

2.2.2.
Research into
Alternatives to Animal Testing

The implementation of the ban is expected
to have overall positive impacts in relation to research into alternative
methods.

Considerable amounts of funding have been
made available to find and validate new alternative test methods. For this
purpose the Commission made about EUR 238 million available between the years
2007 to 2011 alone. The major part of this budget, around EUR 198 million, was
spent on projects through the 6th and 7th Framework Programmes and the LIFE +
Programme. The second most important tranche, about EUR 38 million, was spent
on the European Reference Laboratory (EURL) for Alternative Methods to Animal
Testing (ECVAM).

At Member State level the funding available
varies strongly from Member State to Member State.

Examples
(Note that these figures are not always representative of the entire funding in
the Member State concerned):

Austria: Average for 1992 -2005 EUR 250 000
per year;

Belgium: Between 2005 and 2013 EUR 1 395 847;

Denmark: Between 2005 and 2008 EUR 47 million;

France: In 2010 EUR 2.75 million;

Germany: Between 2000 and 2009 EUR 42.5
million and in 2010 EUR 7.4 million;

Netherlands: In 2010 EUR 2 million;

Sweden: From 2004 onwards around EUR 1.6
million per year.

On the industry side equally there have
been significant efforts. In the recently launched research project Seurat-1[53] on
methods for repeated dose systemic toxicity, the EUR 25 million which come from
the EU research framework programme are matched with EUR 25 million from the
European cosmetics industry, represented by Colipa.

This is in addition to various projects at
association and company level. Individual companies
often work in partnerships with academic institutions.

Examples:
One company invested EUR 30 million in the last 25 years, another has spent an
overall of 285 million USD and another gave the figure of EUR 3 million a year
for external research on alternatives in addition to own research. There are no
overall figures available for the industry investments.

The percentage of cosmetics and cosmetic
ingredients industry's investment in research and development (general, not
alternative method related) ranged from 0.5 to 3.5% of net sales.
The German industry association IKW estimates that about 2.5 to 5% of the
turnover are used for R&D. EFfCI assumes that up to 1% of the annual
turnover achieved in the cosmetic ingredients business by larger companies
is used to develop alternative testing methods.

The majority of the answers received in the
stakeholder consultation highlight the positive impact the provisions in
the Cosmetics Directive and in particular the setting of the 2013 deadline had
on research into alternative methods to replace animal testing. The provisions
are generally seen as a crucial accelerator of research and validation of
alternative methods by all stakeholders. Indeed many projects in this area make
explicit reference to the provisions in the Cosmetics Directive. Stakeholders
also point out that the number of validated methods has greatly increased
since 2003 when the current deadlines were set (13 methods between 2003 and
2009 compared to 6 in the period between 1998 and 2002). The search for
alternative methods is by now also more and more recognized as the search
for better science and forms part of an overall shift of paradigm in safety
assessment. Maintaining the deadline is expected by many to lead to a
continuation or even acceleration of these developments. Certainly the deadline
leaves industry with no other choice than research into alternatives to bring
new cosmetic ingredients on the European market.

Industry stakeholders however point out
that while the research investments were motivated by and linked to the deadlines,
letting the marketing ban apply without alternatives would risk leading to
less funding available for research into alternatives. The main argument
brought forward is that the expected negative impacts from the marketing ban on
competitiveness (see below under 2.2.5) will also weaken the industry's ability
to invest in alternatives. Industry also cautions that research might move
outside the EU.

2.2.3.
Consumer Safety

Specific impacts on consumer safety are
not expected from the 2013 deadline. Consumer
safety is the key objective of the Cosmetics Directive. Manufacturers can only
place cosmetic products on the market if they are safe. Manufacturers must not
place products with ingredients for which insufficient safety data is available
on the market. Market surveillance authorities must ensure that the
requirements of the Directive are complied with. Most Competent Authorities in
the replies to the targeted stakeholder consultation confirmed that in the
course of market surveillance manufacturers that would rely on insufficient
data would be identified.

There is no pre-market authorisation for
placing cosmetic products on the market. Compliance with the Directive, such as
for example not using ingredients that are prohibited, is ensured through
market surveillance, thus in market product spot-checks. Market surveillance is
always linked to resources available, only a sample of products will come under
scrutiny. These limitations apply to all provisions of the Directive.

Nearly all stakeholders agree that while it
is clear that a full safety assessment solely based on alternative methods is
not possible yet, this will result in not being able to place certain products
on the market, not in placing unsafe products on the market.
Stakeholders agree that consumer safety is not put at risk through the 2013
deadline.

2.2.4.
Consumer Choice
and Product Innovation

Overall negative effects are expected
from the 2013 marketing ban for consumer choice and product innovation compared
to the situation before the ban. The cosmetics
industry is highly innovative. On average large cosmetic companies have
a product portfolio of around 10 000 different cosmetic products, SMEs of
around 160 products[54].
Companies working under the Leaping Bunny label had a smaller product
portfolio. They have, for large companies, 592 products on offer and, for SMEs,
40.

Industry stakeholders indicate the product
life of a cosmetic product at 3 years[55].
There is an estimated 25% - 30% renewal of cosmetic products on the market per
year. Out of the 25% to 30% of reformulations, 90% rely on ingredients already
used in the cosmetics sector, 10% depend on new to market (= ingredients not
yet used in any other sector) or new to cosmetics market (= ingredients already
in use in other sector, but new to cosmetics use) ingredients[56]. Information on cosmetic
products and their lifecycle is contained in Annex 5.

Cosmetic products consist of between 5
to 60 ingredients each. Large cosmetics companies
have an ingredient portfolio of 2 000 ingredients and SMEs of 600 ingredients. This
toolbox is constantly evolving.

Large companies introduced around 80 new
ingredients per year between 2000 and 2009 (SMEs 22), representing around 4% of
their ingredient portfolio[57].
Only 10% of these ingredients introduced into the portfolio are estimated to be
new to the market. 90% are/have been used in other sectors, including cosmetic
products outside the EU, food, pharmaceuticals, detergents, and will partially
be covered by REACH. Information on cosmetic ingredients portfolios and changes
to it are included in Annex 6.

Negative impacts of the 2013 deadline are first
expected in relation to ingredients that are new to the market – thus
ingredients that are cosmetic specific and have not been used in
other areas. For such new cosmetic specific ingredients at least part of
the data necessary for the safety assessment will not be available. Since these
are new cosmetic specific ingredients it is not possible to rely on existing
data or data from other regulatory frameworks. 4% of the ingredients portfolio
are renewed each year and 10% of these 4% new ingredients introduced are new
to the market. When calculating this down to total numbers per manufacturer
a large manufacturer with an ingredient portfolio of 2 000 ingredients could
lose 8 of the 80 ingredients it would normally introduce per year.

Second,
negative impacts are expected, though to a lesser extent, for ingredients
that are new to the cosmetics market, but have been used in other sectors.
This is the case for 90% of the 4% newly introduced ingredients, in total
numbers this represents about 72 ingredients per large manufacturer per year.
For these ingredients in the majority of cases data from other regulatory
frameworks will be available, however not in all cases and not always on all
relevant endpoints. In 50 to 70% of the cases submitted to the SCCS, data
from other sources has been relied on in the past. The availability of such
data from other sectors depends however on many factors. Data may not have been
necessary for other uses (for example low tonnage under REACH), it may not be
accessible to the cosmetics manufacturer or the data may not be sufficient to
address the use (eg. different exposure routes). If this is calculated down to
total numbers per manufacturer this would mean that a large manufacturer with
an ingredient portfolio of 2000 ingredients would in the worst case loose
another 21 to 36 of the 72 new to cosmetics ingredients it would normally
introduce per year. However, this is a worst case scenario. The SCCS review
will often require more data than the manufacturer's safety assessment. The
majority of ingredients are not reviewed by the SCCS. This means that,
realistically, the loss of ingredients from other sectors would likely be
considerably lower but uncertainty remains.

Example: Nanomaterials

Nanomaterials are chemical substances or
materials manufactured and used at a very small scale. Over the past years, the
cosmetics industry has focused on nanomaterials and they play an important role
in innovation. The number of patents in the cosmetics field involving
nanotechnology grew by 103% over the last seven years.

Nanomaterials display improved functionalities
in UV filters, but also in dental care, appearance enhancement and skincare.

Under the Cosmetics Regulation, nanomaterial's
come under special scrutiny. Products containing nanomaterial's need to be
notified to the European Commission and information on their toxicological
profile is to be provided. The Commission may request an opinion of the SCCS.
The SCCS has issued guidance for the safety assessment of nanomaterial's in
cosmetics[58],
which clearly underlines the specific challenges of this assessment in the
light of the marketing ban, which will make the introduction of new
nanomaterials only possible in very limited cases in which data is already
available.

Third,
negative impacts are also expected for existing ingredients. This can be
the case if ingredients already in cosmetic use come under scrutiny and new
safety concerns arise. Also, using existing ingredients in new types of
products (e.g. spray) can raise new safety questions that cannot be addressed
by animal testing after 2013. As regards existing ingredients, the SCCS
delivered between 2000 and 2009 opinions on 220 substances, thus an average
of 24 per year. In at least 154 cases a full toxicological data set was
provided. However, the activity in the last 10 years is not entirely
representative, because the majority of cases concerned hair dyes.
Nevertheless an important number of areas of future concern in relation to
existing substances were pointed out by stakeholders. Some of these cases could
be addressed by the existing derogation for Member States, however this
has only been requested one time so far. Uncertainty remains therefore in
how many cases existing ingredients would be impacted.

Examples:

Parabens are widely used as preservatives in
cosmetics. They have come under review as they were considerd to have endocrine
disrupting effects. The SCCS has recently reviewed the safety of parabens[59]. This review
was based on animal data. Without the relevant data to support the safety the
SCCS can not provide a conclusive opinion.

The negative impacts described above are
expected certainly until the time when alternatives for skin sensitisation
tests would become available, but also well beyond as for the other
endpoints no clear timeline for replacement exists. These impacts would
aggregate over the years, but would start diminishing once alternatives become
available.

This loss of ingredients will also have negative
impacts on the availability of cosmetic products. There is no
linear link between ingredients and cosmetic products. 25% to 30% of the
cosmetic products are on average reformulated per year. 90% of these
reformulation rely on existing ingredients, 10% rely on new to market or new to
cosmetics ingredients.

Three situations can be differentiated. The
first one concerns cases in which reformulations rely on new to market
ingredients extensively used in cosmetics. These are unlikely to be possible
after 2013 as the safety of these ingredients cannot be demonstrated. Second,
the cases in which the reformulation depends on new to cosmetics ingredients.
Also here in a number of cases the reformulation will not be possible if
existing data from other fields is not sufficient. Third, cases in which
reformulation concerns ingredients used already in other cosmetic products.
This should in most cases remain possible, but different uses may lead to
different types of exposure and therefore different data needs. Overall, while
it is difficult to give a clear indication of the total number of products
concerned, the data implies that in the worst case up to 10% of the total 25 to
30% of annual reformulations will be affected (= 2.5%), mainly those relying on
new to market ingredients. Assuming a total number of 300 000 products on the
market this could mean that up to 7 500 products could be lost per year.
Assuming the lower estimate of a total of 100 000 products on the market it
could mean a loss of about 2 500 products.

Example:

Company A (=ingredient manufacturer) develops
after 2013 an ingredient with better anto-ageing properties. Company B
(=cosmetics manufacturer) would like to bring a new skin care product on the
market using this ingredient. To do so it needs to comply with the Cosmetics
Regulation and carry out the required safety assessment. This requires
information on the toxicological profile of the new ingredient. While the
Cosmetics Regulation contains no tick-box of data required, at a minimum
information on skin sensitisation (= can the ingredient cause allergies) and
repeated dose toxicity (= are there other negative effects on the body as a
result of repeated use) will be needed. Currently no alternative methods exist
for these endpoints and since the ingredient is new and not used in other
areas, no data is available. As a result Company B would not be able to place
the new skin care product on the market.

Impacts would likely not be immediate in
2013. Due to the product development cycle and the fact that the deadline has
been known for a long time it is expected that the impacts will mainly
kick-in by 2014/2015 and continue over the following years. It is also
assumed that the cosmetics industry is likely to be able to counteract some
of these developments by innovating using existing ingredients or new
ingredients supported by sufficient data. As mentioned above impacts would
start diminishing as alternatives become available.

Stakeholders have different views on the
likely impacts on ingredient and product availability. Industry stakeholder provided the figures discussed above and
summarized in the table below and consider that the impacts will be serious.
An argument made by some animal welfare stakeholders on the other hand
is that if some companies can innovate and reformulate without animal testing,
others should be able to do so as well. The argument here is essentially that
the existing ingredient pool is sufficient.

The graph below summarises the figures
discussed above and the likely impacts:

2.2.5.
The
Competitiveness of the EU Cosmetics Industry

The impacts of the 2013 deadline on the
competitiveness of the EU cosmetics and cosmetics ingredients industry are
expected to be overall negative compared to the situation before the ban.
This assessment concentrates on the impacts on product innovation and turnover resulting
from a limited access to ingredients. These impacts could be mitigated by
other measures taken by the industry to maintain its role and turnover, such as
marketing and new ways of innovation. While ingredients clearly are key to
innovation, to some extent also other factors, such as product presentation,
product application (brushes, form of delivery etc.) play a role in innovation.
It is also assumed that this innovation would be extended if the innovation
capacity from ingredients is limited.

The innovation capacity of the cosmetics
industry is linked to the availability of innovative ingredients and the
possibility to reformulate products. The European cosmetics industry has a leading
role in product innovation. The EU is home to some of the most advanced and
luxurious cosmetic products brands. Limits on the ability of the European
industry to reformulate products and to introduce innovative ingredients could
reduce its overall role as driver of future developments. Such a
development is expected by industry to lead to more conventional, mass
market and lower priced products, which is in turn could lead to a
reduction in sales and profitability for the cosmetics companies.

Along with a loss in innovation capacity,
industry also expects potential impacts on turnover. The cosmetics industry had
a turnover of EUR 71 billion in 2010. New ingredients have a significant impact
on profitability as it is often these ingredients and the products formulated
with them that lead to the greatest profit. There is however considerable
uncertainty as to the exact impacts. The estimates provided by the Colipa
respondents were that large companies expected an overall significant loss in
turnover and profitability, with losses ranging from 3 to 20% in the short
term (2013-2015), 7 to 20 % in the medium term (2015 – 2018) and 1 to 25% in
the long term (2018 and beyond).

Turnover and profitability may also be
affected by the costs of loss of existing ingredients. The examples below show
the costs that could be occurred as a result.

Examples of direct costs incurred in past in
case of re-formulation:

Product Withdrawal: Company Y decided to
replace a UV-filter (included in skin care products) because its supplier had
withdrawn it from the market rather than fund additional testing to support an
SCCP dossier. 12 formulations were affected at a cost of between EUR 5 000 and
EUR 10 000 per formulation, equivalent to between EUR 60 000 and EUR 120 000.

Product Reformulation: Company Y decided to
replace a thickening ingredient in 70 formulations, 30% of which were produced
by a contract manufacturer, which increased the reformulation costs. The cost
of this was between EUR 1500 and EUR 5000 per formulation, equivalent to
between EUR 100 000 and 350 000.

Impacts are expected in particular for
ingredient manufacturers. In particular ingredient manufacturers
specialised in cosmetics are expected to face difficulties. EFfCI data
suggests that in the medium term (2015 to 2018) reductions in sales of up to
20% are expected.

However, stakeholder views on the
effects on competitiveness diverge enormously.
While industry and some Competent Authorities share the expectations above,
animal welfare stakeholders on the other hand point out that maintaining the
ban provides the opportunity for the EU industry to be the leader in
implementing animal free safety assessment strategies. Companies following
the 'Leaping Bunny' label and ECEAE considered to 57% that it would have a
positive impact on sales and to 43% that it would have no impact. 65% of
the participating companies considered that it would have a positive impact on
the EU marketing position and its global positioning.

Finally, the development of alternative
methods in itself is innovation and leads to business opportunities. An
example is the development of reconstructed skin by a cosmetic company now used
in place of animal testing for skin irritation and which is being tried for
other uses as well. It is by now also marketed outside the company and has
become a business in itself.

2.2.6.
Regional and
Sectorial Impacts

Member States with the largest cosmetics
industry are Germany, France, the United Kingdom, Italy and Spain. These
make up 69% of the total sales. It is these Member States that would likely be
most impacted by the 2013 marketing ban. These countries are also the largest
exporters of cosmetics.

The largest market segments are skin
care and toiletries (52% of the market share), overall all market segments
had a positive growth over the last years. There is no clear indication which
segments would be most impacted, but a number of assumptions can be made. Products
which rely most on cosmetic specific ingredients, such as UV filters, hair dyes
or specific skin care, are likely to be impacted most. It could also be assumed
that sectors which currently have a high innovation activity based on the
patents activity described under 2.1.1., such as make-up and skin care could be
particularly impacted.

Depending on the ingredient the supply
chain starts with either raw material producers or ingredient manufacturers.
Some ingredients are also produced by the cosmetics manufacturers themselves.
As regards the distribution channels for the cosmetic products they generally
fall under four main categories: mass distribution, specialised distribution,
pharmacy sales and direct sales. In France the breakdown in 2007 was 54% mass
distribution, 28% specialised distribution, 10% pharmacy sales and 7% direct
sales, while in Italy it is 41% mass distribution, 40% specialised distribution,
13% pharmacy sales and 6% sales[60].
While the impacts on the ingredient manufacturers and the cosmetics
manufacturers were described above, there is no clear indication on how these
impacts may affect the distribution chain.

2.2.7.
Trade Impacts

The deadline on export and import of
cosmetic products could also have a certain negative impact. The EU cosmetics market represents almost half of the global
market, with the United States and Japanese market estimated respectively at
EUR 37.8 billion and EUR 29.4 billion.

In relation to exports, industry
stakeholders expect export losses. One reason brought forward in the targeted
stakeholder consultation is that less innovative EU products would be less
attractive for export. Also, around 76% of the larger Colipa companies
expect the development and production of innovative products to move outside
the EU to continue to serve emerging markets, particularly in Asia.

Similarly, it is feared that ingredient
manufacturers based outside of the EU would have a competitive advantage. EU
based manufacturers fear no longer being able to drive demand for new
ingredients which could result in the drivers for innovation in cosmetic
ingredients moving away from the EU.

Another problem EU products are expected to
face is that many trading partners – such as China – still require animal
testing data for certain endpoints. While it is possible to have different
product lines or safety assessments for inside and outside the EU and
production in the EU could therefore still take place for export only, this is
likely to be an option only for a few larger companies. Larger companies may
formulate more innovative products for export with ingredients for which they
cannot show the safety purely based on alternative methods yet and which can
therefore not be placed on the EU market.

The 2013 deadline is also expected by
industry stakeholders to lead to impacts on imports. At the moment, the
EU is the only region with such stringent bans in place. New products developed
outside the EU will still mainly rely on animal data for the safety assessment
and are likely in many cases to fall under the marketing ban. Between 52% and
64% of responding large Colipa companies expect imports to be reduced.
Similarly, between 60% and 69% of EFfCI companies expect such impacts. In the
short term this could lead to a competitive advantage for EU companies on the
EU market. While this may be a short-term advantage for industry there could be
a growing risk of non-compliant products being imported to the EU to meet
consumer demands.

2.2.8.
Employment

In relation to employment, while future developments are difficult to predict and to
quantify, the cosmetics industry and the ingredients industry expect that the
2013 marketing ban could lead to negative impacts on employment though again
it needs to be stressed that the data basis is rather uncertain.

The overall number of direct employees in
the cosmetics industry in 2009 was approximately 177 000, around
137 000 of whom were in manufacturing, including 17 000 in Research &
Development, and around 40 000 in distribution. In 2010 direct employment had
grown to 184 000. In addition, indirect employment, including retail and
salons, is estimated to be about 1.7 million. SMEs are estimated to employ
around 35% of the total direct employees, thus around 62 000. However, figures
supplied from Germany indicate that in Germany alone 45 000 employees work in
the cosmetics industry and that of these 85% to 90% work in SMEs.

In addition, large ingredient
manufacturers (cosmetics and cosmetic and other ingredients) employ about
110 000 people overall in the EU with approximately 5% of these employed in the
development, manufacture, import or supply of cosmetic ingredients, thus about 5
500 employees. Taking cosmetics and cosmetic ingredients manufacturer
together, this leads to total of 182 500 employees based on 2009 data.
The average number of employees in SME´s according to EFfCI data is 90, with 71
of them employed in the development (including R&D), manufacture, import or
supply of cosmetic ingredients.

The main impacts on employment could occur
as a result of possible relocation of activities in reaction to the
marketing ban. Industry expects that a limited
possibility to develop new products in the EU will favour R&D and
product development to move closer to emerging markets. Industry also
points out that this could be a threat to the cosmetic industry's strong
academic networks in the EU as well, with new networks being developed outside
the EU.

Example:

One large company alone
currently collaborates with around 60 academic groups and funded over EUR 3.5
million in external research in 2010.

76% of responding large Colipa cosmetic
companies predict that R&D would be relocated.
The amount of R&D relocated could be up to 50%, depending on the company.
45% of SMEs considered that R&D facilities would relocate.

The ingredient manufacturers have similar
expectations; 53% predict that up to 50% of R&D could relocate. The
development of innovative new raw materials and finished ingredients is
expected to move more outside the EU. Relocation of R&D is however not a
necessary impact, since R&D could remain in the EU, even for products
that can as a result of the marketing ban not be placed on the EU market, but
only exported.

Besides the relocation of R&D, industry
considers that production facilities could also move outside the EU to focus
on growth markets and because of the reduced turnover and profitability
of the industry in Europe. This could in the longer run also impact jobs in
supporting functions and management. 89% of large cosmetics company
respondents from Colipa considered that the ban would have such impacts on
employment. It is estimated that a considerable part of the 17 000
scientists' posts would be endangered. In addition, the loss of jobs in the
production and supporting functions is expected. More than 66% of EFfCI
large company respondents considered that the ban would have impacts on employment.
It was also pointed out that once the shift of excellence (and related jobs)
outside the EU has occurred, it is unlikely to be reversed.

It needs to be stressed once again that
there is considerable uncertainty about the exact impacts on employment.
The figures above are forward looking industry expectations. According to these
expectations, the majority of industry stakeholders expects an impact
that would affect several thousand R&D staff, up to 8 000, as well as
other staff.

However, many of the target markets for
European manufacturers are already today outside the EU. The highest market
growth is expected to take place by 2015 in South America and Africa. The
market for premium cosmetics in China is expected to double by 2015. Relocation
may therefore take place in any case.

2.2.9.
Specific
Impacts on SMEs and Micro-Enterprises

Particular attention has been given to
the situation of SMEs[61]
and micro-enterprises[62]
in the assessment. Around 100 SME's provided input
to the Colipa response to the targeted stakeholder consultation and the
Commission services met with a number of national associations and small
manufacturers to complement the information.

The marketing ban applies to large and
small companies alike and the cosmetics industry has a high percentage of SMEs.
SMEs are therefore clearly among those affected by the ban. According to data
provided by Euromonitor for 2010, there were about 4 072 small and medium sized
cosmetic product manufacturers in the 27 EU Member States. In some Member States,
SMEs represent more than 80% of the overall cosmetic manufacturers, as reported
by Colipa and EFfCI. In Germany, in 2008 SMEs represented 76% of the total
number of cosmetic manufactures (but the statistics do not cover all sectors,
so the percentage for the whole cosmetic sector is probably even higher).
Figures from Germany also indicate that the overall number of SMEs in the
cosmetics field is much higher than the Euromonitor data suggests. The European
Organization of Cosmetics Ingredients Industries and Services (UNITIS),
representing companies in the field of botanical natural complex substances is
made up of 50 member companies, all of them SME's.

Specific data on the number of
micro-businesses is not available, however data collected in the context of the
earlier impact assessment[63]
indicated that there were 855 firms with fewer than 10 employees in France
in 2004 and that Italy had over 1000 firms with fewer than 10 employees.
These figures would indicate that the share of micro-businesses is very high.

Colipa estimates that the SME market share
is about 30% (about EUR 20 billion) of the total EU cosmetics industry. This is
confirmed by figures received from Germany, where SMEs have 36% of the market
share in this sector.

SMEs and micro-enterprises were not
excluded from the testing and marketing ban when it was introduced. Exempting
SMEs and micro-enterprises would run counter the animal welfare objective and
is therefore also not considered in this assessment.

SMEs and micro-enterprises face in
principle the same impacts as those described above, ie. less access to
ingredients and thus limited possibilities of product re-formulations. However,
the impacts are not expected to be the same for all SMEs.

SMEs and micro-enterprises specialised
in cosmetics with a high rate of innovation could
feel the impacts of the marketing ban. They often consider that the bans will
have no impacts on them since they do not themselves test or commission tests.
However stakeholders also underline (eg. the input received from UEAPME) that
SMEs might be the least aware of these impacts. SMEs depend to a large extent
on toxicological data being provided to them by their suppliers and may not be
aware of the extent to which this data will not be available in the future.
They will also often have less access to data from other sectors than larger
companies with a varied product portfolio. Also, a more commoditised
market/mass market that competes more on price is likely to disadvantage SMEs
that can less easily compete on economies of scale rather than in niche
markets. SMEs are also less likely to relocate or to focus on exports.

Another group of SMEs and micro-enterprises
that is likely to be affected are small and specialised ingredient
manufacturers. UNITIS in particular underlined in its submission to the
targeted stakeholder consultation impacts on its around 50 SME specialised
member companies. Ingredient manufacturers and especially small and specialised
ones depend on constant ingredient innovation.

There are however also a number of niche
market SME's and micro-enterprises that might be less negatively affected by
the ban or even benefit from it. This would include companies already
working under the 'animal testing' free label. Around 115 companies are part of
the Leaping Bunny label in Europe (400 worldwide) alone, many of whom SME's.
This would also apply to SMEs that work with well-established product lines,
such as traditional soaps or other products less prawn to product innovation.

2.3.
Subsidiarity

The use of Union competences is governed by
the principles of subsidiarity and proportionality (Article 5 TEU). The current
EU legislation on cosmetics is based on Article 114 TFEU (ex-article 95 TEC)
and its aim is to ensure a high level of protection of human health as well as
the proper functioning of internal market. Article 13 of the TFEU contains the
obligation to pay full regard to the welfare requirements of animals when
implementing the internal market policies.

The Cosmetics Directive/Regulation
exhaustively harmonises rules on consumer safety of cosmetic products placed on
the EU market. Thus, changes to this legal framework can only be achieved by EU
action. The marketing ban directly addresses the free
movement of cosmetic products in the Union. This is already subject to
harmonized legislation and cannot be addressed at Member State level without
leading to a serious fragmentation of the market. It can therefore only be
achieved at Union level. Besides the testing and marketing ban, the Cosmetics
Regulation also harmonised the possibility to grant derogations from the bans
and provided such a possibility under Article its 18 (2).

All previous legislation in relation to the
marketing ban was adopted at Union level. The first provisions in relation to
the marketing ban of cosmetic ingredients or combinations of ingredients tested
on animals in order to meet the requirements of the Directive were introduced
to the Cosmetics Directive in 1993 with an application date of 1 January 1998,
first postponed to June 2000, then to 30 June 2002 and finally for the
endpoints in question here to March 2013. These extensions of the deadline were
essentially due to the non-availability of alternative methods to animal
testing, however the last extension made the testing ban and the 2009 marketing
ban independent of the availability of alternatives (see for more details above
2.1.3.).

3.
Objectives
3.1.
General objective

The general objective is to ensure a proper
functioning of the internal market and maintaining a high level of protection
of human health, while paying full regard to the welfare requirements of
animals.

3.2.
Specific objectives

The specific objectives followed are
accordingly on the one hand linked to the functioning of the internal market
(3.2.1. and 3.2.2., Article 114 TFEU) and on the other hand to the animal
welfare objective (3.2.3. and 3.2.4., Article 13 TFEU).

3.2.1.
To maintain
consumer safety and consumer choice (specific objective 1 – Consumer Safety and
Choice)

For more than 30 years, the Cosmetics
Directive has provided a legal framework that ensures consumer safety. The
Cosmetics Regulation strengthens this framework. The Cosmetics legislation has
favoured a broad, varied and innovative offer of cosmetic products to European
consumers. Consumer choice is likely to be impacted by a limited access to
certain cosmetic ingredients and thus products. The objective is to maintain
the current level of consumer safety and consumer choice.

3.2.2.
To maintain
innovation and competitiveness of the European cosmetics industry (specific
objective 2 – Innovation and competitiveness)

The Europe 2020 strategy for smart,
sustainable and inclusive growth[64]
called for an ‘Innovation Union’ to improve the framework conditions for
innovation[65].
The regulatory framework for cosmetics should therefore be supportive of
innovation. The current framework has contributed to a thriving cosmetics
industry that has also largely been able to resist the economic crisis. The
cosmetics and cosmetic ingredients industry also plays an important role in
creating jobs - direct and indirect. A reduced access to cosmetic ingredients
and the resulting limited product innovation could impact the competitiveness
of the industry. The objective is to maintain industry's capacity to innovate
and its competitiveness. The EU is an important trading partner for third
countries when it comes to cosmetics, with the EU representing almost half of
the global market, followed by the United States and Japan. The objective is to
maintain this trade.

3.2.3.
To provide
animals with a high level of protection and welfare (specific objective 3 -
Animal Welfare)

Animal welfare is enshrined in Article 13
of the Treaty on the Functioning of the European Union, which is part of its
provisions with general application. The objective is to pay full regard to
animal welfare in implementing the Union's policies. While currently animals
are still used outside the EU for the purposes of the EU cosmetics legislation,
once the 2013 deadline enters into force such testing data cannot be relied on,
leading to a likely reduction in animal use. Animal welfare is also served
through a proper enforcement of the current provisions. Legal clarity in
relation to the scope of the provisions and additional tools for Member State
authorities to carry out the necessary checks in relation to the compliance
with the marketing ban will help ensure the effectiveness of the provisions in
place. The Commission Communication on the European Union Strategy for the
Protection and Welfare of Animals 2012-2015[66]
in particular underlined the need for better implementation and enforcement of
existing provisions in relation to animal welfare.

3.2.4.
To maintain the
incentive for continued research on alternative methods to animal testing
(specific objective 4 – Research into alternatives)

A safety assessment of cosmetics without
using animals can only be achieved if alternative methods are in place.
Considerable funding has been made available to develop and validate new
alternative methods to animal testing by the Commission, Member States and the
cosmetics industry. These efforts have contributed to validated alternative
methods for several endpoints. Significant advances have been made in reducing
the number of animals used in tests. These findings have not only benefited the
cosmetics industry, but help to reduce the number of animals used across
sectors. The objective is to keep up or step up the momentum for the remaining
endpoints, not only out of animal welfare considerations, but also because this
work allows to better understand the toxic pathways and to make better safety
assessments in the long run. Development of alternatives is itself innovation
and creates new opportunities for industry. Continued efforts in research into
alternatives is also in line with the Commission's international co-operation
in the International Cooperation on Alternative Test Methods (ICATM).

4.
Policy Options
4.1.
Option 1: Baseline/No Action

Option 1 is the scenario in which the
Commission does not present a proposal in relation to the 2013 deadline of the
marketing ban to the European Parliament and the Council. The legal framework
will remain unchanged, resulting in an entry into force of the marketing ban in
relation to the 2013 endpoints on 11 March 2013, irrespective of the
availability of alternative methods to animal testing. The rationale behind
option 1 is that it is the most effective way to obtain the overarching
political objective that lead to the current provisions - to abolish animal
testing for cosmetic purposes.

4.2.
Option 2: Postpone the 2013 deadline

In the absence of alternative methods by
the 2013 deadline, the deadline could be postponed. This has already been done
on several occasions (see above 2.1.3.). Option 2 foresees three sub-options
for a postponement of the 2013 deadline. The overall rationale behind the
different sub-options under 2 is to maintain the overall objective to end
animal testing for cosmetic purposes, but to take account of the finding that
alternatives are not yet available and to thus make reaching the objective one
way or the other dependant on the availability of alternative methods.

4.2.1.
Option 2 (a):
Postpone the 2013 deadline with fixed deadline

Option 2 (a) foresees the postponement of
the deadline for a fixed time. Given that it is not clear when alternatives
will be available, any postponed deadline would serve mainly as a review
deadline, by which progress and efforts in research and development of
alternative methods would be evaluated. This option therefore would envisage a
postponement of 7 years and then a review exercise similar to the one recently
carried out, with the possibility of a further postponement should alternatives
not have been found despite the demonstration of serious research efforts. The
rationale behind option 2(a) is that it follows the logic of the earlier
interventions. It sets a deadline after which a review will take place, is thus
not based on the assumption that at that point in time all alternatives will be
available. The 7 years are chosen because the indication of the first phase of
stakeholder consultation is that – in the best case – at least alternatives for
skin sensitisation could be validated by then (experts expected the alternative
methods to be available the earliest by 2017, in addition at a minimum 3 years are
needed for validation, which would lead to 2020), so that a possible subsequent
postponement could exclude this endpoint.

4.2.2.
Option 2 (b):
Postpone the 2013 deadline in relation to certain endpoints only and maintain
for others

Option 2 (b) would be similar to Option 2
(a), but restrict the postponement to certain endpoints only. Essentially this
would foresee no extension for tests used less frequently (carcinogenicity,
toxicokinetics and reproductive toxicity), a one-off extension for skin
sensitisation and extension for repeated dose toxicity subject to review. The
rationale behind option 2 (b) is to limit the postponement only to those
endpoints most needed to demonstrate the safety of the cosmetic products, ie. skin
sensitisation and repeated dose.

4.2.3.
Option 2 (c):
Postpone the 2013 deadline without fixed deadline

Option 2 (c) would do away with the fixed
deadline, but maintain the current mechanism according to which the ban applies
as soon as an alternative method has been validated and adopted at EU level,
with due regard to the developments of validation within the OECD. The ban
would clearly apply once a method would be validated and included either in
Regulation 440/2008/EC or in Annex VIII of the Cosmetics Regulation. It would
also be possible to already require replacement earlier, e.g. as soon as a
satisfactory scientific method or testing strategy is available[67]. In the future, alternative
methods will not be one-to-one replacements, but rather integrated testing
strategies. The process for validation and regulatory acceptance of these strategies
is only being developed. Option 2 (c) would be most coherent with the
overarching provisions in Directive 2010/63/EC or the approach in REACH to use
animal testing as a last resort. The rationale behind option 2 (c) is essentially
to let science deliver.

4.3.
Option 3: Maintain the deadline and introduce an
additional derogation mechanism

Option 3 aims at maintaining the deadline
while allowing access to market for innovative cosmetics with clear benefits
when the safety assessment requires animal testing for cosmetics purposes. To
this end, it foresees the introduction of a derogation, complementing the one
already existing for Member States[68].
Given that uncertainty remains about the actual impacts of the 2013 deadline,
option 3 would be a kind of safety valve to allow key innovation. It will also
make the problematic cases in which data is missing and the industry considers
that the ingredient is of significant benefit transparent and will thus allow a
better re-assessment of the policy in the future.

The derogation could apply both to the
testing and the marketing ban. Applying it to the testing ban is not considered
as the testing ban has applied in full since March 2009 and the review clause
does not refer to the testing, but only to the marketing ban. In addition,
there was no call to do so by stakeholders. It was further considered whether
the derogation should apply to innovative ingredients only or to existing
ingredients as well. This latter possibility was however discarded as in these
cases, the derogation for Member States is in place. It is also considered that
data from other legal frameworks may help.

The provisions envisaged would allow a
cosmetics/ingredients manufacturer (or associations of manufacturers) to
request a derogation from the marketing ban for specific ingredients or
combinations of ingredients under limited circumstances.

(1)
A request would need to contain a demonstration
that the ingredient in question would bring innovation and a significant
benefit to consumer health, consumer well-being and/or the environment.
Whether the conditions would be fulfilled would be a case-by-case assessment of
the Commission. Innovation would be demonstrated by comparison with existing
ingredients and their functions. Significant benefits could be shown for
example in the case of an ingredient that is less likely to induce allergies
than ingredients currently used, in the case of a new preservative (a limited
number of preservatives creates the risk of microbial cross-resistance), in the
case of a new sun protection ingredient with better environmental properties,
in the case of an ingredient that would help to address needs of specific parts
of the population. These criteria would not be fulfilled in the case of
lower cost or greater accessibility of ingredients, in the case of ingredients
that facilitate the production process, ingredients that only bring incremental
product improvements, such as better emulsifier, product aesthetics or new
colour shades. Since it would be a derogation, the cases in which it applies
should represent the exception, not the rule.

The operational application would clearly be very
challenging. Examples exist in other areas of similar evaluations and the
criteria developed there could be partly drawn on. This is notably the case
under the authorisation procedure under REACH[69],
which requires the evaluation of socio-economic benefits of substances for
which an authorisation is requested and the exemptions under Directive
2011/65/EU in relation to restrictions of hazardous substances, which allows an
exemption taking into account 'the availability of substitutes and the
socioeconomic impact of substitution', taking also account of adverse
impacts on innovation[70].

However, under the current legislation there is
only a limited requirement to document the effect claimed for the cosmetic
product under Article 11, 2, (d) of the Regulation. Article 20 of the
Regulation requires that claims must relate to actual characteristics and
functions of the product. Specific benefits of new ingredients as such do not
need to be demonstrated. Nevertheless, the decision whether or not to change
the formulation of a product and whether to introduce a new ingredient
assumingly are based on company internal considerations on the expected benefit
of the ingredient. These would need to be documented for the application.

(2)
Manufacturers would need to demonstrate that
toxicological data needed for the safety assessment is not available and cannot
be obtained using alternative methods to animal testing, in a reasonable
timeframe. This verification would in any case be part of the safety assessment
process, here it would need to be documented.

(3)
Manufacturers should demonstrate their
commitment in relation to their investments in research for alternative
methods. Such a commitment could e.g. be demonstrated by contributions to
Framework Programmes, own research activities or contribution to academic
research work. It will be evaluated on a case-by-case basis. SMEs and
micro-businesses will be exempted from this requirement. The objective is to
ensure that the derogation is not used as a way to avoid research into
alternatives, a logic similar to the requirement of a substitution plan under
REACH.

In the application, the manufacturer would
need to provide details on the proposed place of testing, the protocol
followed, the number of animal involved and the animal welfare standards
applied. This will include information on the test protocol followed, such as
reference to OECD protocol. It would also include information on the purpose
for which the testing was carried out and a description of the test that can be
made public together with the description of the ingredient.

Consideration would also be given to avoid
on the one hand that the derogation excludes others than the applicant from the
use of the ingredient (= not the create 'monopolies') and on the other hand to
avoid that the derogation allows for duplicate animals testing.

In terms of procedure, such a derogation
would be granted in the form of a Commission Decision. This would allow for the
fastest decision-making. In terms of time between 6 month and 1 year are
expected to be needed for the decision-making. Appropriate expertise , notably
the SCCS, could be consulted on the questions whether the toxicological data is
needed and whether the test in question is appropriate to provide it.

5.
Analysis of Impacts
5.1.
Methodology and possible impacts identified

The following assessment of the impacts is
focused on the analysis of each option in its entirety, focusing on the environmental,
economic and social impacts. The environmental impacts are limited
to the impacts on animal welfare and research into alternatives and are dealt
with upfront. The environmental concerns that substances used in cosmetic
products may raise are considered through the application of REACH, which
enables the assessment of environmental safety in a cross-sectoral manner.

5.1.1.
Impacts Policy
Option 1 - Baseline/No Action

The effects of the no action scenario have
been described and analysed in detail above in the problem description and will
only be summarized here. In the absence of an amendment to the Cosmetics
Regulation, option 1 will apply as of 11 March 2013.

As regards environmental impacts the
application of the deadline is expected to spare a sub-set of 15 000 to 27 000
animals per year. This concerns animals used for testing outside the EU only,
as the testing ban applies and is not put into question. Option 1 fully meets
the overall political objective to end animals testing for cosmetics. It is
also the option that is expected to contribute most to the development of
alternatives methods.

As regards economic impacts, option 1 is
expected to lead to a certain reduction of cosmetic ingredients. A large
cosmetics manufacturer with an ingredient portfolio of 2 000 ingredients could
lose 8 of the 80 new ingredients normally introduced per year as these would be
new to the market. Also access to ingredients already used in other sectors
would be limited. In the worst case a large cosmetic manufacturer could lose
another 21 to 36 ingredients per year. In addition, existing ingredients come
under review regularly and might not be sufficiently defended. This could in
total concern up to 24 existing ingredients per year. The data implies that in
the worst case up to 10% of the total 25 to 30%, i.e. 2,5 to 3%, of annual reformulations
will be affected, mainly those relying on new to market ingredients. This could
impact between 2 500 and 7 500 products per year in total.

This loss of ingredients could lead to a
loss of competitiveness. It is estimated by industry stakeholders that large
companies could face losses in turnover ranging from 3 to 20% in the short
term (2013-2015), 7 to 20 % in the medium term (2015 – 2018) and 1 to 25% in
the long term (2018 and beyond). Member States with the largest cosmetics
industry are Germany, France, the United Kingdom, Italy and Spain. Exports and
imports would also be affected given that animal data is needed for the safety
assessment in third countries.

The impacts on availability of ingredients
and the resulting impacts on turnover could also lead to lower employment of R&D
staff, up to 8 000 in the worst case, as well as other staff. It has to be
stressed that these are estimates from the industry stakeholders and that no
independent data is available to verify these impacts and that views of
stakeholders diverge enormously.

5.1.2.
Impacts Policy
Options 2 (a), (b) and (c) – Postpone the 2013 deadline

Environmental Impacts

All sub-options discussed under option 2 maintain
the overall objective to phase-out animal use for cosmetics. They do
however allow for more time to achieve this objective as they make it
one way or the other dependant on the availability of alternative methods. Under
all sub-options of option 2 animal testing outside the EU for EU cosmetics
purposes could therefore continue beyond 2013, meaning the continuous use of
15 000 to 27 000 animals per year. In relation to the ethical
considerations and expectations of European citizens any extension of the
deadline is likely to be seen negatively.

There are some differences in the impacts
on animal numbers between the sub-options. Option 2 (a) would lead to the continuation
of the use of between 15 000 and 27 000 animals per year for the coming 7
years. Any further prolongation would require an amendment of the
legislation.

Option 2 (b) would limit the number of
animal used compared to the situation now by at least 12%, this represents the
percentage of the less used tests excluded under this option. This would mean
that at least 1 800 to 3 240 animals less would be used. However, this
number is likely to be somewhat higher because in cases in which a reproductive
toxicity study would be needed for the assessment and cannot be carried out it
does also not make sense then to carry out the skin sensitisation test.

Option 2 (c) would continue the use of
animals as now and as under option 2 (a) per year. The difference is that there
would be no fixed deadline, but that the ban would kick in once
alternatives become available. It would still mean that the number would
diminish. Assuming that alternatives for skin sensitisation become available by
2020 this should mean a 70% reduction of testing (this is the percentage of
skin sensitisation testing now). This would mean that beyond 2020 the numbers
would go down to about 4 500 to 8 100 animals per year, until further
alternatives become available.

All options under 2 are generally expected
to have somewhat negative impacts in relation to research in that the
postponement takes away the immediate need for research in alternatives. In
particular option 2 (c) would make the ban dependant on the availability of
alternative methods and but would not set a fixed deadline. Many stakeholders considered
that it was exactly the deadline that led to intensified research funding.

Economic Impacts

Under options 2 (a), (b) and (c) the
deadline would be postponed, with the result that also beyond 2013 new
cosmetic-specific animal data could be relied on for the safety assessment of
cosmetics. This would maintain the availability of ingredients and the
possibility to reformulate products as it is now before the entry into
force of the marketing ban. There would be therefore overall no economic
impacts expected under option 2, the cosmetics market could continue to develop
as described under 2.1.1.

Slight differences exist however depending
on the sub-option. Options 2 (a) and 2 (c) both foresee a postponement for all
endpoints. Option 2 (b) foresees the postponement for certain endpoints
only. Therefore option 2 (b) would have negative impacts in the few
cases in which this data is needed, thus in about 12%.

Also in relation to trade the situation
will essentially remain as it is now, and export and import activities can
continue. Under option 2 (b) slightly negative impacts are however expected in
cases in which data on endpoints for which the deadline was not prolonged are
in question.

Social Impacts

As for the economic impacts, essentially
the situation will remain the same to the current situation. Of the
sub-options, option 2 (c) would have possibly positive impacts
compared to the situation now, as it takes away a fixed deadline and thus provides
most confidence in the future ability of the cosmetics industry to innovate and
this stability could lead to more employment. Under this option industry can be
sure that innovation can be continued either based on animal data or based on
alternatives.

Stakeholders have split views on option
2 and its sub-options. Animal welfare stakeholders
and some Competent Authorities clearly oppose any postponement,
independent of the sub-option. They consider that enough time has passed since
the bans were first introduced 20 years ago and that no further postponement is
acceptable. As described above under 2.2.4 and 2.2.5, they also do not consider
that the marketing ban leads to considerable negative impacts, and therefore do
not see the need of a postponement. The wish to maintain the 2013 deadline also
seems to reflect the views of many citizens, as evidenced by the large number
of letters and mails against any postponement directed to the Commission.
Industry stakeholders on the other hand and several Competent Authorities
generally support a postponement, with option 2 (c) being the preferred option
that is considered to be the most science based approach. They consider that a
postponement is the best way to avoid the negative impacts expected from the
marketing ban and consider that the impacts on animal welfare are limited.

5.1.3.
Impacts Policy
Option 3 - Maintain the deadline and introduce an additional derogation
mechanism from the marketing ban

Environmental Impacts

Option 3 would essentially lead to similar
positive impacts as option 1 in relation to animal welfare. It maintains
the deadline and thus ends the use of a sub-set of the currently used 15 000 to
27 000 animals per year.

It would, however, lead to the
possibility to request derogations and, thus, in a limited number of cases to
testing outside the EU for EU cosmetics purposes beyond 2013. A derogation
would be sought in relation to the safety assessment of a specific ingredient.
The number of animals impacted would depend on how often such a derogation
would be granted.

There is uncertainty about the
overall number of ingredients introduced for the total industry. The data
provided in the targeted stakeholder consultation indicates that in total there
may be at a minimum around 150 new ingredients introduced for the cosmetics industry
per year in Europe. At a maximum the number of new INCI codes indicates that up
to 500 new ingredients could be introduced to the cosmetics industry per year.
Both figures include new to the market and new to the cosmetics market.
Therefore it is likely that only about 10% of these would be new to the market
and most likely to require a derogation, thus somewhere between 15 and 50
ingredients per year. Other ingredients are more likely to have data sets from
other uses. However, also for at a maximum for half of the new to cosmetics
market at least some data may be needed (see above 2.2.4.). This would mean
that between 82 and 275 new ingredients would be likely to require animal data
per year.

Only assumptions can be made to the
possible number of derogations requested and granted based on these figures. One assumption could be that the use would be similar to the use
of the current Member State derogation, which has been applied for one time
since 2009. This is however for various reasons not likely to be a valid
assumption (see above 2.1.4.). Another assumption could be that a derogation
would be requested for nearly all new ingredients, thus at the high end up to
275 times per year. The derogation is however designed to apply only in
exceptional circumstances and the aim is not to turn the ban into an
authorisation scheme. This assumption is therefore not likely to be valid
either. The third assumption would be that the derogation would only apply in a
small percentage of the newly introduced ingredients and would probably only
be used in about 10 to 15 cases per year. This appears the most likely
assumption.

In the majority of cases testing on skin
sensitisation and repeated dose would be needed. The data in Annex 2 implies
that, per derogation granted, a minimum of 100 animals would be used. This
figure could in some cases be higher, depending on the testing needed. Based on
these estimates the derogation could lead to a use of about 1 000 to 1 500
animals per year. It would in each case depend however which data is already
available. It should be noted that the derogation could, and is likely to be,
also sought in order to rely on testing data which already exists, but which is
covered by the marketing ban, e.g. testing done to meet third countries
cosmetics legislation. In these cases the testing would not be triggered by and
not be a direct impact of the derogation.

Option 3 will lead to a similar need for
alternative methods as option 1 and thus equally have positive impacts on
research. However, this effect may be somewhat limited by the possibility
to request a derogation.

Economic Impacts

Under option 3 the situation is to some
extent similar to the one under option 1, thus the ban enters into force
and similar negative impacts can be expected than the ones described under
2.2.4 and 2.2.5. However, option 3 would allow limiting the negative impacts
of option 1 in that it provides the possibility for industry to request a
derogation on a case-by-case basis. Most of the new ingredients would not
fulfil the criteria for a derogation, as they may be added for example for
reasons of better availability, price or other rather incremental innovation
reasons. The derogation would therefore most likely cover only a small
number of the cases. Nevertheless, Option 3 would provide the possibility
to introduce the derogation for the most valuable ingredients and
product innovations with particular benefit for consumers. It would
therefore allow mitigating the most serious impacts. It is not possible
to provide an estimate of to which extent the derogation would limit the
impacts on turnover in quantitative terms. While the derogation may only apply
in a few cases in terms of numbers, they are expected to concern the
ingredients with the biggest impact on innovation and competitiveness. So even
if it would be granted as assumed above in only about 10 to 15 cases, the
economic impact would be mitigated to a higher extent as the ingredients in
question are likely to have a comparatively higher value.

The derogation would apply to large and
small companies essentially the same way. However the derogation mechanism
would also foresee a number of ways to take account of the specific needs of
SMEs. First, the derogation could also be applied for by a group of
applicants. Second, it could allow for ingredient manufacturers to
apply. Third, the decision could not only apply to the direct applicant,
but to anyone which whom a data sharing agreement is in place. SMEs and
micro-business can therefore benefit from derogations requested by others,
notably further up the supply chain. Indeed in most cases SME's do rely on data
from the supply chain in any case. Fourth, SMEs could be exempted from
the requirement to demonstrate their commitment to research.

In relation to trade option 3 would allow to
mitigate some of the trade impacts. In relation to export, because the
derogation would still allow for key innovations within the EU and for the EU
market, which could then be exported. In relation to imports, because the
possibility to request a derogation would also be open to third country
manufacturers and would allow them access to the EU market with innovative
products.

Social Impacts

As regards employment, the situation is essentially
similar to option 1 (see above under 2.2.8). To which extent the derogation could
mitigate the expected negative impacts cannot be quantified.

Stakeholders had mixed views on option 3. Animal welfare stakeholders reiterated in the consultation on the
derogation that they wish to maintain the deadline as is, thus not to introduce
a derogation. As described earlier, their concern is less the potential number
of animals used under the derogation, but letting the marketing ban apply in
full is a question of principle. Industry stakeholders recognised that – should
no postponement be considered - the derogation could offer a solution at
least for a few innovative ingredients. Given that industry considers that
most of the testing would be done in any case for third countries, the impacts
on animal welfare were considered to be very limited. Industry stakeholder
underlined that the derogation would by far not mitigate all negative
economic impacts of the 2013 marketing ban. In comparison to a postponement
it is clearly seen as less favourable by industry. It also comes with delays
and administrative costs (see below 5.2). Administrative Costs

Administrative costs are defined as
"the costs incurred by enterprises, the voluntary sector, public
authorities and citizens in meeting legal obligations to provide information on
their action or production, either to public authorities or to private
parties".[71]

The options 1 and 2 do not raise any
specific additional administrative costs for the industry, Member States or the
Commission. Option 3 however does raise substantial administrative costs at
industry level.

These costs would arise on the industry
side for the preparation and the follow-up of a derogation file. This would not
involve a fee, but would consist of the time needed to compile and substantiate
the derogation file. To some extent, the information needed for the derogation
file would be information industry would need to consider in any case when
introducing a new ingredient. The elements to be covered in the derogation file
were described above under 4.3. and are:

(a)
A detailed argumentation and substantiation of
the innovation and the benefits of the ingredient in question. This is as such
not required under the Cosmetics Regulation, with the exception of the cases in
which due to the nature or effect of the cosmetic product proof of the effect
needs to be included in the Product Information File (see Article 11, 2 (d));

(b)
Detailed reasoning in relation to the need for
animal data in the safety assessment versus relying on alternative methods
(description of possible existing alternatives routes, such as Threshold of
Toxicity Concern (TTC). While this does not require documentation currently,
already now under the '3 R's' policy manufacturers must reflect on whether
animal testing cannot be avoided by other approaches. Information on any
testing carried out or planned (numbers, place, protocol etc.) must also be
provided. This information is readily available and the current legislation
requires that the source of toxicological information must be clearly
identified (Annex I, Part A, 8 of the Regulation);

(c)
Demonstration of the financial commitment to
research into alternatives (funding provided to EU Framework Programmes, own
research activities, contribution to academic research work etc.). This is a
new element.

Apart from the financial commitment to
research, the costs for such a derogation file can be estimated to some extent
by looking at the costs of two types of files existing under the Cosmetics Directive, the costs for the
safety assessment file on the one hand and the costs for submission
to the SCCS on the other hand. For both cost information was provided in the
impact assessment preceding the adoption of the Cosmetics Regulation[72].

The costs were determined using the administrative costs
the EU Standard Cost Model[73]:

∑
P x Q

where P
(for price) = tariff x time

Q
(quantity) = number of business and frequency

Accordingly, the costs for industry to
establish the necessary safety evaluation data for a SCCS submission range from
EUR 100 000 to EUR 1 000 000 per substance. These costs are
usually borne by a consortium
of companies to share these costs. The costs for a correct product safety
assessment (for the product safety file) for a new formulation were estimated
to in average be approximately EUR 15 000.

The costs to prepare the derogation dossier are likely to be closer to the second case,
ie. the costs for the product safety assessment.

Unlike the dossier for the SCCS, the
derogation dossier would not have to address the safety of the substance. It
would also not address all endpoints, but only the ones for which the
additional data is needed. The costs for the derogation dossier would also not
include the costs arising for producing testing data to demonstrate safety.
These were included in the cost estimates above and constitute a large part of
the costs. Therefore the costs for the derogation file would not be comparable
to the SCCS dossier.

The derogation dossier would be rather
comparable in overall complexity and likely cost to the product safety
assessment file. It would not include certain elements of the product safety
assessment, but on the other hand include additional ones. Overall it is
therefore in balance considered comparable. It would only address one
ingredient and not all ingredients of the product, as does the product safety
assessment. It would also not have to argue the safety of the ingredient. It
would however have to include information and demonstration on the four
elements above.

6.
Comparing the options
6.1.
Comparing the options on Effectiveness

When looking at the extent to which the options achieve the objectives, option 1 –
maintaining the deadline – clearly makes the animal welfare objective paramount
and is the most effective option in this respect. The number of animals spared
as of 2013 would be a sub-set of the estimated 15 000-27 000 animals used for
cosmetic specific testing outside the EU per year. Option 1 also clearly best
reflects the ethical considerations of many EU citizens that animal welfare is
not only about numbers, but about a basic ethical value decision. The
expectation is that no animal should suffer because of a cosmetic product. In
relation to the internal market objectives, option 1 is however less effective.
It can lead to a more limited consumer choice and to less competitiveness of
the European industry compared to the current situation.

Option 2 and its sub-options – the
postponement options - are least effective in relation to the animal welfare
objective of the considered options. While the long-term objective to end
animal use is kept, under all sub-options the animal use outside the EU for EU
purposes would continue, even though with some differentiation in relation to
number of animals or time depending on the sub-option. Option 2 also meets the
ethical consideration of citizens the least of the options. A further
postponement of 7 years would mean a total postponement of 22 years after the
first foreseen deadline. In addition, given that for several endpoints
alternatives are not expected to be available then either it would already
foreshadow a further postponement. On the other hand option 2 is the most
effective of the options in relation to the internal market objectives, as it
essentially maintains the current situation, which has allowed the industry to
provide a wide range of safe and innovative cosmetics to the market and to
maintain a competitive position. Of the sub-option under option 2, sub-option 2
(c) is the most effective in this regard, it makes the ban dependant on the
scientific criteria of availability of alternatives and thus would not leave
industry in a situation in which the tools for the safety assessment of
cosmetics would not be available.

Option 3 – the derogation - is less
effective than option 1, but more effective than option 2 in relation to the
animal welfare objectives. The overall ban remains in place and only a limited
number of animals would be used under the derogation. The derogation would be
granted under exceptional conditions only. In relation to the internal market
objectives option 3 is more effective than option 1, but less effective than
option 2. Option 3 at least allows a certain amount of innovation and could mitigate
possible negative impacts of option 1 to some extent. The likely challenging
application, which would each time raise the same ethical debate and would have
to involve considerable judgement on the Commission side, would however limit
the effectiveness of the option.

6.2.
Comparing the options on Efficiency

In relation to efficiency, option 1 scores
lowest of the options considered in that achieving the animal welfare objective
can have an impact on the internal market objectives. The sub-set of 15 000 to
27 000 animals spared could come at the cost of a certain reduced availability
of innovative ingredients, thus leading to less product innovation. It could equally lead to difficulties
in relation to the assessment of existing ingredients, even though the existing
derogation for Member States may help. Option 1 could lead to a somewhat more
commoditised and less innovative market and is likely to impact the
competitiveness of the EU cosmetics industry. Also, certain consumer demands could
possibly not be met.

Option 2, and specifically option 2 (c),
comes with no drawbacks in relation to the internal market objectives. However, while it maintains the long-term objective in
relation to the animal welfare, it comes at the price of continued animal use
at the same level as now for the coming years and the drawback of the 'ethical
defeat' and of being considered to lose the animal welfare objective out of
sight.

Option 3 maintains the deadline and thus
adheres to the animal welfare objective, but at the same time provides the
possibility of using the most significant innovative ingredients and thus
mitigating some of the drawbacks of the deadline. The derogation would be
subject to a Commission decision, and thus to a judgement whether in the case
at hand the benefits offered by the ingredient can outweigh the drawback of the
animal use. Option 3 is not likely to reduce the negative impacts of the
marketing ban on the internal market objectives completely, but could limit
them in some specific cases.

In quantitative terms the differences in
efficiency between the options are limited. In relation to the animal welfare
objective, because in comparison with other sectors the total number of animals
involved is relatively low anyhow and because the differences in animal use
between the options are difficult to quantify beyond the overall estimates. Also,
under all options the animal numbers would decrease in time as alternative
methods become available. In the best case this could be the case for skin
sensitisation by 2020, leading then independent of the option chosen to a
reduction of animal use of 70%. In relation to the internal market objective
because while there will be undoubtedly a reduced access to existing and new
ingredients and economic and social impacts are expected, they remain difficult
to quantify and figures given were to a large extent based on industry estimates.
In addition, counterbalancing measures such as EU support for research for
research and development of alternative test methods could not be taken into
account due to a lack of solid data.

6.3.
Comparing the options on Coherence

Option 1 scores high in coherence with the
overall animal welfare objectives of the Union, but low in coherence with the
way the same question is addressed in other Union legislation.

All sub-options under option 2 score well
in relation to coherence with overarching policies, in particular relating to
innovation and competitiveness orientated objectives. Option 2 (c) could be
seen as the most coherent approach compared to the way the same issue is addressed in other areas of EU
legislation. On the other hand option 2 is least coherent with the animal
welfare objective.

Option 3 comes with trade-offs and advantages on overarching objectives.
It aims in particular at ensuring the innovation related objectives under the
EUROPE 2020 strategy, but it clearly is in some contradiction to the animal
welfare objective.

|| Environmental Impacts || Economic Impacts || Social Impacts

Option 1 || Sub-set of 15 000 to 27 000 animals per year spared (for EU cosmetic purposes) Acceleration of development of alternative methods with impacts beyond the cosmetics sector || Certain limitations in access to new ingredients, leading to a certain reduced product innovation. Possible loss of existing ingredients. Possible negative impacts on competiveness of the cosmetics and cosmetics ingredients industry and trade. || Possible loss of R&D and other jobs as a result of the economic impacts.

Option 2 (a) || Sub-set of 15 000 to 27 000 continues to be used per year for the next 7 years || The current situation is maintained. || The current situation is maintained.

Option 2 (b) || Sub-set of 15 000 to 27 000 animals continues to be used per year, but minus 12% for tests excluded (- 1 800 to 3 240) || The current situation is maintained, but in a number of cases negative impacts (+/- 12%) || The current situation is maintained, but in a number of cases negative impacts

Option 2 (c) || Sub-set of 15 000 to 27 000 animals continues to be used per year, no fixed cut-off, but probably reduced as off 2020 by 70%, so beyond that sub-set of 4 500 to 8 100 animals per year || The current situation is maintained, but more planning safety is provided. || The current situation is maintained, but more planning safety is provided.

Option 3 || Animal use stopped as under option 1, but possible to request derogation. Certain number of animals used under derogation about 100 animals, total number depends on number of derogations granted, estimated to about 1 000 to 1 500 per year. || Negative impacts as under option 1, but certain mitigation through the derogation for the most beneficial ingredients. || Negative impacts as under option 1, but certain mitigation through the derogation for the most beneficial ingredients.

Looking at the stakeholder views, all
stakeholders share the overall objective to end animal testing for cosmetics.
Stakeholders have no interest in animal testing as such, other than as a tool
to ensure and demonstrate consumer safety. Indeed alternative methods may turn
out to be beneficial for industry.

The question remains however what to do in
the cases in which alternatives are not available. Here, the views of
stakeholders on the options are split. Animal welfare stakeholders took
throughout the process a clear position against any proposal in relation to the 2013 deadline, thus clearly
supporting option 1. Their position is one of principle and focussed on the
animal welfare objective, irrespective of potential negative impacts on other
objectives. Industry stakeholders have underlined that they expect significant
negative impacts on them from the 2013 deadline and limited positive impacts
for animal welfare. They have therefore overall supported the approach to let
science deliver, thus supporting option 2 (c). Industry has nevertheless
provided input on the derogation in option 3, recognising that - as a fallback
position if a postponement is not proposed - the derogation is better than
option 1. Member States appear to have split views, some (Denmark, Italy, France, Greece and the Czech Republic) expressed
their support for a postponement (for one of the sub-options under 2) and
others (Austria, Sweden and the
Netherlands) are supporting option 1. However, not all Member States have
expressed a view and, given that the issue has a clear political dimension,
views taken at working level may not be representative for positions that would
be taken in Council.

6.4.
Preferred Option

The preferred policy option is in this case
not a decision based on numbers only. It involves ethical questions of
principle. There is a long history of political decision-making on this issue,
with the bans first introduced going back as far as 1993. The objective of the
legislator has clearly been ending animal use for cosmetics. Any decision will
therefore have to take the political background into account.

6.5.
Financing

In case a proposal by the Commission was
made scheduled, an adoption of the legislative act by the co-legislator could not
be expected before the end of 2013, with the application of the derogation
starting in 2014 so that credits for its implementation would need to be
foreseen as of 2014 which would go hand in hand with the start of the next
Multiannual Financial Programme (MFF) 2014-2020.

Costs for the Commission would arise under
Option 3 as it would require additional resources to assess derogation
requests, in the Cosmetics Unit as well as in the Unit administering the SCCS.

While there is uncertainty as to the number
of derogation request, it is estimated that about 10 to 15 ingredients would be
eligible per year. The staff required will depend on the number of derogations to deal with.

Estimated
budgetary needs

The average staff costs for the Commission are taken as a basis of the calculation, i.e. EUR 127 000/year for one AD/AST (2011 prices)

Commission (Operational Unit for Cosmetics Regulation/Unit responsible for the Scientific Committee) ||  EUR 254 000 /year (for 2 FTE with overhead)

7.
Monitoring and evaluation

Monitoring and evaluation can be assured through
existing mechanisms under the Cosmetics Regulation.

The Cosmetics Regulation foresees a
mechanism of yearly reports to the European Parliament and the Council in its Article 35. These reports address the
progress made in the development, validation and legal acceptance of
alternative methods, statistical data on animals used and progress in
international acceptance of alternative methods. While the yearly reporting is
considered as too frequent, these regular reports provide a valuable tool to
determine to which extent the safety assessment for cosmetics can already be
based on alternative methods.

The last reports have equally addressed the
implementation and enforcement of the testing and marketing ban. The
enforcement of the rules is the task of the Competent Authorities and is part
of their overall market surveillance activities. Market surveillance has been
reinforced by the Cosmetics Regulation, in particular in its Article 22, which
foresees that the Member States should at least every 4 years periodically
review and assess the functioning of their market surveillance activities and
inform the Commission and the Member States and make their assessment publicly
available. This would present an additional monitoring tool. Cooperation on
market surveillance is also supported through the Cosmetics Committee, the
Working Group on Cosmetics and the Platform of European Market Surveillance Authorities
(PEMSAC).

In case option 3 is chosen, the enforcement
of the marketing ban would be further strengthened and a reporting on the
derogation scheme would be foreseen. The reporting on the derogation would look in particular at the following aspects:

· Number of derogations requested and granted;

· Number of animals used under the derogation;

· Test protocols requested under the derogation;

· Time required for the derogation process;

· Types of ingredients covered by the derogations (granted and non-granted)
and benefits put forward.

\*          \*          \*

Annex 1: Summary
Second Phase Stakeholder Consultation

1. Introduction

A first phase stakeholder consultation on
the availability of alternative methods by 2013 was carried out between April
2010 and May 2011. Information on this exercise, the contributions of the stakeholders, a summary report of the
consultation as well as the final report, have been published on the Directorate-General
SANCO's cosmetics website[74].

The result of the first phase of the
consultation showed that alternatives to animal testing for the 2013 endpoints
will not be available by 2013. The Commission services therefore started a
second phase of stakeholder consultation in order to obtain information on the
potential impacts of the entry into force of the 2013 deadline in the absence
of alternatives. The Commission services consulted targeted stakeholders and
Member States. The list of stakeholders consulted included the cosmetics
industry, ingredient manufacturers, animal welfare organisations and the
Scientific Committee for Consumer Safety (SCCS), as well as trading partners.

The consultation questionnaire, as well as
a list of stakeholders consulted, is available on the Directorate-General
SANCO's cosmetics website[75].
The consultation took place between 7 December 2010 and 11 April 2011. The
contributions of the stakeholders to the targeted stakeholder consultation have been equally
published on the same Directorate-General SANCO's cosmetics website. None of
the respondents claimed confidentiality.

The main purpose of this second
consultation was to obtain information and data allowing the analysis of the
impacts of the 2013 deadline in the absence of alternatives.

The Commission services received 14 answers
from Member States (Austria, Belgium, Denmark, Finland, France, Germany,
Greece, Italy, Netherlands, Poland, Portugal, Slovakia, Spain and Sweden) plus
an answer from Norway; 4 industry association replies (Colipa, EDfCI, UEAPME and UNITIS); 5 replies from animal welfare
associations (Eurogroup for Animals, ECEAE, Four Paws, Animal Defenders and
PETA); a reply on behalf of the SCCS and a reply from the Chinese SFDA.

Some stakeholders, in particular Colipa,
EFfCI and ECEAE, each collected data from their members for a consolidated
submission of their respective organisation to the consultation.

2. General Findings

The consultation resulted in diverging
views in relation to the possible impacts of the entry into force of the 2013
marketing ban and the best way forward. Industry, several Member States (Denmark, Italy, France, Greece and the Czech
Republic) and the SCCS expected significant negative impacts on availability of
cosmetic products, the competitiveness of the cosmetics industry and on
employment, and considered a prolongation of the deadline the most logical way
forward. Animal welfare organisations and some Member States (Austria, Sweden
and the Netherlands) by contrast were clearly opposed to any proposal in
relation to the deadline. Other stakeholders mainly described the expected
impacts without taking a clear position. In particular industry stakeholders
underlined to which extent the impacts depend on the interpretation of the
existing provisions.

3. Comments and information supplied on
specific items of the Questionnaire

The questionnaire was organised according to seven groups of questions.

1) Existing Data on the Cosmetics market
and the industry

Industry
respondents provided additional data on the cosmetics market to complement
existing data from earlier impact assessments.

2)
Impacts on Animal Welfare/Environmental Impacts

Respondents provided information on the
number of animals affected (in and outside the EU), the needs in relation to
testing data as well as the impacts on research and the incentive role the
provisions play.

Information on number of animals affected
was received predominantly from industry and animal welfare group respondents.
The answers highlighted that the testing in question is testing outside the EU
(testing ban already in place in EU since 2009 and much earlier in some Member States) and thus not covered by
existing reporting requirements in the EU on animal use. Animal welfare groups
and industry provided different elements to allow a quantification of the
possible number of animals concerned. These included information on the number
of tests carried out by cosmetic companies, estimates based on extrapolations
of the number of animals that were used in the EU for cosmetic testing in the
past, testing and animal numbers normally necessary for the safety assessment
of an ingredient and on the number of animals used in tests submitted to the
SCCS.

In relation to research into alternatives,
several respondents provided information on funding of such research, either
through Member States, industry or other. There was overall agreement between
all respondents that the provisions in the Cosmetics Directive had an important
incentive function. Respondents had however split views on what will be the better incentive for
research going ahead. Industry respondents maintained that the deadline will
negatively impact the available funding for research and may even lead to a
relocation of research into alternatives, while several Member States and the
animal welfare respondents considered the deadline to be the best incentive for
research into alternatives.

3)
Impacts on Consumers

Respondents provided information on impacts
on consumer safety and product availability. The clear majority of respondents
underlined that there would be no impacts on consumer safety since ingredients
for which no sufficient data is available would not be allowed to be placed on the market. Some Member States
pointed nevertheless to difficulties in market surveillance.

The clear majority of respondents
considered that animal data on the endpoints in question will be necessary for the safety assessment of cosmetics. The
highest data needs identified were skin sensitisation, second repeated dose,
reproductive toxicity and toxicokinetics. In particular industry respondents
provided data on the testing carried out over the last 10 years to substantiate
the main data needs. In relation to data used from other sectors many
respondents – and particularly the industry – confirmed that data from the food
sector, from cosmetics testing for outside EU regulatory requirements, from
REACH/CLP, from biocidal products and from pharmaceuticals field were
important.

Respondents from Member States underlined
that data will in the future not only be needed for new ingredients, but that
also existing ingredients are likely to come under review. Often mentioned
substances expected as future candidates for assessment were: colorants also used in food (this is expected to mainly
impact decorative cosmetics), nanomaterials, endocrine disrupters, sun
protection products in general, and skin care in particular in relation to
preservatives.

While in particular animal welfare
stakeholders considered that the actual impact on availability of ingredients
and thus cosmetics products would be negligible or should in any case be
accepted because of an overriding ethical interest, industry and other stakeholders considered that there are
likely to be considerable impacts. Industry, as well as one animal welfare
respondent, provided detailed information on ingredient and product portfolio
size and changes to allow quantification of the possible impacts.

4)
Impacts on Competitiveness of Cosmetic and Cosmetic Ingredients Manufacturers

In particular industry respondents, but
also some Member States, voiced clear concerns that the deadline will lead to a loss in competitiveness of the
cosmetics and cosmetics ingredients industry. While industry provided data on
the expected impacts, any quantification remained approximative and based on
forward looking expectations.

5)
Impacts on Small and Medium sized Enterprises (SMEs)

Overall respondents underlined the high
percentage of SMEs in the cosmetics sector and their importance in terms of
employment. Some Member State and industry responses highlighted that SMEs
sometimes may not be sufficiently aware of the possible impacts, but are in
reality likely to be hit harder than large companies. SMEs typically rely on less ingredients and less
products, and may have more difficulties to offset loss of ingredients. On the
other hand it was also pointed out that SMEs often use the animal testing free
label.

6)
Impacts on Employment

Industry and some Member States provided
information on the current employment in the cosmetics industry. Industry respondents expressed the fear of
relocation of research and development, which may also lead to a loss of
employment in production and marketing.

7)
Impacts on Trade

In particular industry respondents underlined the role of trade for the cosmetics
industry and its current global role. They considered that the deadline may
lead to reduced imports and exports.

4. Follow-up contacts in relation to
derogation

The consultation on impacts was followed-up
and further detailed in relation to a derogation option through bilateral
consultation with targeted stakeholders and through a detailed presentation in relation to this option in the Cosmetics
Committee and Working Group on 9 November 2011 and on 23 March 2012.

Animal welfare stakeholders reiterated in
this context their position to maintain the deadline as is, without any derogation. Some industry and Member State
stakeholders saw the benefits of a derogation approach as offering a possible
balanced approach, but questioned the criteria to be applied, the
practicalities of granting the derogation and the possible timeframes.

\*          \*          \*

Annex 2: Numbers
of Animals used for Toxicological Testing

1) Cosmetic Specific Animal Testing Data
EU:

Year || Cosmetics Commission Reports

2009 || 344

2008 || 1510

2007 || 1818

2006 || 1329

2005 || 2276

2004 || 8988

2003 || 1618

2002 || 2153

2001 || 2592

2000 || 3138

1999 || 3630

Estimated total 1999-2008 || 29396

Source: Reports as published on SANCO
website
(http://ec.europa.eu/consumers/sectors/cosmetics/documents/animal-testing/index\_en.htm)

2) EU Animal Numbers for the endpoints
covered by 2013 deadline not cosmetic specific 2008:

2008 – overall per testing area

Skin sensitisation || 38437 ||

Carcinogenicity || 20807 ||

Sub-chronic and chronic toxicity testing || 103005 ||

Developmental and reproductive toxicity || 31286 63815 ||

Total || 257350 ||

Source: 6th Statistical report,
compiled by Eurogroup and submitted to the Targeted Stakeholder Consultation

3) Estimated animal numbers per
endpoint:

Endpoints || Animals per Test || Assumes that underlined protocols are followed

Skin corrosion || 1 || OECD 404

Skin irritation || 2 || OECD 404

Skin absorption/penetration || 4 || OECD 427 (4 – 16)

UV-induced toxic effects – photogenotoxicity || 25 || OECD 474 : micronucleus –N=25 Rarely done – nowadays in vitro 3T3 NRU

UV-induced toxic effects - acute phototoxicity || 10 || Acute test only See also Photosensitization

Eye irritation || 3 || OECD 405

Acute toxicity || 10 || OECD 420: 5 to 20 OECD 423: 6 to 12 OECD 425: 5/doses - nb of doses: 1 to 5

Skin sensitisation || 20 || LLNA OECD 429: 20 OECD 406: 32

Sub-acute and sub-chronic toxicity || 80 || OECD 407: 40 OECD 408: 80

Genotoxicity and Mutagenicity || 25 || OECD 474 (Micronucleus): 5/group, 3 dose levels, 2 controls = 25 OECD 486 (UDS): 3/group, 2-3 dose levels, 2 controls = 12 to 15 OECD 478 (lethal dominant test): test rarely performed but at least 240 animals

UV-induced toxic effects, photo-allergy || 30 || Photosensitization : see above

Toxicokinetics and metabolism || 12 || OECD 417 (4 per dose/ 1 pilot plus 2 doses = 12)

Carcinogenicity || 240 || OECD 452: 160 and if interim sacrifice 80 additional OECD 453: at least 400

Reproductive and developmental toxicity || 100 || OECD 414: 80 to 100 OECD 416: 120

Inhalation toxicity/allergy/sensitisation || 40 || OECD 412::Sub-acute Inhalation Toxicity: 28-Day Study: 40 OECD 413: Sub-chronic Inhalation Toxicity: 90-day Study: 80

Source: compiled by Colipa, based on OECD
Guidelines and submitted to the Targeted Stakeholder Consultation

Annex 3: The
Need for Toxicological Data for the Cosmetics Safety Assessment

Whether or not ingredients can be used in
cosmetic products depends on whether their safety can be demonstrated. Essentially toxicological data needs arise in
two scenarios:

The first is the manufacturer's
safety assessment of cosmetic products he places on the market. This assessment
is based on the safety of the ingredients. In line with Annex I of the
Cosmetics Regulation the cosmetics safety report must contain the toxicological
profile of each substance contained in the cosmetics product for all
relevant toxicological endpoints. A particular focus is on local toxicity
evaluation (skin and eye irritation), skin sensitisation, and in the case of UV
absorption photo-induced toxicity. All significant routes of absorption must be
considered as well as the systemic effects and margins of safety (MoS) based on
a no observed adverse effects level (NOAEL) must be calculated.

The highest data need for the cosmetic
manufacturers exists for skin sensitisation tests, second for repeated dose,
third for reproductive toxicity and then for toxicokinetics and
carcinogenicity. Skin sensitisation, i.e. allergic reactions to certain
cosmetic ingredients plays an important role from a consumer safety point of
view. An estimated 60% of all undesirable effects are cases of allergic
reactions.[76]
Sensitisation is a significant pathology which affects the quality of life of
consumers for the rest of their lives. Colipa data shows that over the last ten
years large companies carried
out on average 213 animal tests for the 2013 endpoints per year, out of
which 151 addressed skin sensitisation and 36 repeated dose, thus
these two endpoints represent 87% of all testing. EFfCI confirmed the
order of importance of the different tests. SMEs participating in the Colipa
response carried out on average 7 tests per year over the last 10 years and
tested only on skin sensitisation.

The second scenario is ingredients
that are reviewed by the SCCS, either with a view to be added to one of the
positive lists or to be prohibited or restricted in use. It can not be
assumed that all ingredients in use now will remain available to the cosmetics
industry after 2013. A number of Member States pointed out that many
ingredients in use now are not supported by sufficient toxicological data.
Often mentioned substances expected as future candidates for assessment were:
colorants also used in food (this is expected to mainly impact decorative
cosmetics), nanomaterials, endocrine disrupters, sun protection products in general, and skin care in particular in
relation to preservatives. Preservatives in particular could become a sensitive
area as a number of substances in this field are under review (such as
parabens) and the list of available preservatives is likely to reduce.

Example
Hair Dyes:

In Europe
more than 60% of women and 5-10% of men colour their hair with a mean frequency
of use by 6-8 times per year. The average age of majority of hair colour users
is 30-60 years.

The hair
dye market in the EU was EUR 2.6 billion in 2004, i.e. some 8% of the value of
output of the cosmetics industry in Europe.

In the
context of the Commission decision to review the safety of hair dyes used in
the EU, 45 commonly used hair dyes which represented around 95% of what is used
in the EU had to be reassessed with “2013 tests”.

According to the SCCS Notes of Guidance[77] if a substance is submitted to
the SCCS the minimum data set that needs to be provided includes two
endpoints that fall under the 2013 deadline: skin sensitisation and repeated dose toxicity.

When considerable oral intake is expected
or when the data on dermal/percutaneous absorption indicates a considerable
penetration of the ingredients through the skin (taking into account the toxicological profile of the substance
and its chemical structure), data on carcinogenicity, reproductive toxicity and
toxicokinetics becomes necessary. A review of data submitted to the SCCS
between 2000 and 2009 shows that of 220 substances reviewed 154 had data
intended to determine a full toxicological profile. All but 5 had repeated dose
data and 137 had data on reproductive toxicity[78].

For all of these endpoints a full
replacement of animal tests is not yet possible. For skin sensitisation alternatives are however expected to be
scientifically available by 2017-2019; validation and regulatory acceptance is
expected to take another 3 to 6 years.

Example:
When the negative effects of UV-A became more known companies developed over
the last 10 to 15 years several new UV-A filters. The approval of these filters
to be added to the Annexes of the Cosmetics Directive was also based on animal
testing data.

However, this does not automatically
mean that all new ingredients would be blocked from the market or that no
existing ingredients could be defended. Data may be already existing and it
may be possible to rely on such old data. Data may also be available form other
sectors. To some extent the existing derogation for Member States could be used in case data needs arise. Finally
data may not always be needed and other tools may be able to be used for the
assessment. Data on carcinogenicity, reproductive toxicity and toxicokinetics
is as explained above not always required. The Cosmetics Regulation also
supports the use of a weight-of-evidence approach and allows in duly
substantiated and justified cases a read-across. Also, the scientific
committees jointly adopted guidance in relation to the use in certain cases the
Threshold of Toxicological Concern (TTC)[79].

In a number of cases it will therefore be
possible to carry out a safety assessment in line with the legal requirements
even in the absence of toxicological animal data. Since the safety assessment
is a case-by-case evaluation it is difficult to assess in how many cases
such other approaches will be sufficient. A recent review under REACH[80] showed that read-across and weight
of evidence was used quite extensively in the absence of animal data. For
repeated dose toxicity 28.1% of the dossiers relied on read-across and 6.6% on
weight of evidence. For skin sensitisation 20.8% relied on read-across and
13.7% on weight-of-evidence. These figures are however considered to be high
and it is likely that in a number of these cases additional data will need to
be requested. Also, these figures all related to existing substances for which
data allowing read-across was available.

Annex 4: Testing
Data Sources

The data used so far for the cosmetics
safety assessment is in most cases not generated specifically for this
purpose. In about 90% of the cases cosmetic ingredients are used in other
areas as well. The testing data required for cosmetics testing is general testing data following OECD
guidelines that is equally used for other purposes.

However, this does not mean that in all
these cases no additional data would be needed specifically with a view to the
cosmetics use. To which extent existing data from other sectors is sufficient
and to which extent cosmetic specific data is needed is a case-by-case question that depends on a number of
factors (which data is already available, is it an SCCS assessment or not,
etc.). While there is no clear data allowing to say exactly in how many cases
existing data is sufficient, estimates can be made based on the information
supplied below.

Colipa informed that in about 50% of the
cases in which a substance was under SCCS review and supported by Colipa
additional information including animal testing had to be provided to the SCCS.
Colipa itself supported since 2004 7 dossiers for new UV filters and
preservatives and defended 58 ingredients which were assessed by the SCCS, this
corresponds to 20 dossiers for which animal data had to be generated (skin
allergy, reproductive toxicity, sub-chronic studies, toxicokinetics and
carcinogenicity).

Example:
In the case of the hair dye strategy, industry submitted 203 animal studies,
out of which 101 had to be specifically generated.

33% of Colipa companies responding informed
that in 2010 they undertook animal testing to provide information to the SCCS,
in earlier years on average 56% of the companies undertook such specific animal tests.

This data does not allow a clear
quantitative determination in how many cases additional data may be needed.
From this it would nevertheless roughly appear that in relation to substances
under SCCS assessment in 50 to 70% of the cases sufficient data from other
sources is available. The SCCS review is a very in depth and general
evaluation of the safety of the ingredients and it is likely that more in depth
data is needed than for the manufacturer safety assessment. Only 10 % of the
new substances fall under SCCS review.

In many cases testing data is provided by
the ingredient supplier. Testing data may also be available in publications, in
databanks, etc. Often the original reason for the testing will not be
obvious from the testing data itself.

According to the Colipa information, large
companies considered testing data from food, cosmetic products outside the EU and REACH as most important to them. This does
not necessarily reflect that this data is available in most cases, as the
question was only how important it is considered to be, not in how many cases
it was available. However, while there remains uncertainty, it is likely
that the importance given also reflects the availability to some extent. The
difference with the views expressed by SMEs is notably that they consider third
country data less important and give more importance to REACH. SMEs are less
likely to act internationally and will therefore in fewer cases have access to
data generated for third countries.

Importance of Different Sources of Animal Test Data to Large Companies (Past 5 Years)

Animal test data source || Number of companies

|| Not important || Moderately important || Very important

Pharmaceuticals || 6 || 4 || 7

Medicinal of veterinary products || 8 || 2 || 6

Biocidal products || 5 || 7 || 4

Food Products || 1 || 5 || 11

Cosmetic products outside the EU || 2 || 7 || 8

REACH or CLP || 4 || 5 || 8

Other || 3 || 1 || 4

Source: Colipa
submission to the Targeted Stakeholder Consultation

A similar evaluation of important data
sources was provided by EFfCI.

Generally nearly all comments received on
the question of the key data sources and on how they are likely to develop in
the future indicate a higher availability of toxicological testing data as a result of REACH requirements. However, it was
also pointed out that, although for substances above 100 tons/year data will be
available in June 2013, for substances between 1 to 100 tons/year data may only
be available as of 1 June 2018 and may thus not be available for the first 5
years of the full ban.

Example:
Existing cosmetic ingredients may need to undergo animal testing under REACH. A
recent example of a substance widely used in cosmetics that underwent testing
is calcium carbonate (used in toothpaste).

So far a total of 1849 animal tests were
conducted since 2009 for REACH registration purposes and 711 testing proposals
were submitted to ECHA, the clear majority of them relating to repeated dose
and reproductive toxicity testing.

Annex 5: Cosmetic
Products and their Life Cycle

On average large
cosmetic companies have a product portfolio of around 10 000 different
cosmetic products, SMEs of around 160 products according to data supplied
by Colipa. Companies that participated in the ECEAE survey had for large
companies 592 products on offer and SMEs 40. The difference between these
figures is likely to be due to a higher percentage of small and specialised
companies providing data to
ECEAE (only 2 large companies participated). Overall it is estimated that there
are between 100 000 and 300 000 different cosmetic products on the market, but
there is no reliable data on European level so far[81]. Sweden
provided the information that there were 35 000 products in total notified in
Sweden in 2009 and 8700 new products were notified to be placed on the market
in Sweden in 2009. In Portugal about 23 000 new notifications for new cosmetics
products are received per year.

Industry
stakeholders indicate the product life of a cosmetic product at 3
years. There is an estimated 25% - 30% renewal of cosmetic products on
market per year.

The development cycle of a new
product is described by UEAPME to be between 9 months to 1 year, however
for very innovative products it may take up to 5 years. While this pace
of innovation holds true for many, some manufacturers re-formulated a much higher percentage of their products per
year, up to 90%. Large companies participating in the ECEAE survey added 5
products per year, representing 6% of the market value of their overall
products, SMEs added 4 products, representing 22% of the market value of their
overall products.

Out of the 25% to 30% of reformulations,
90% rely on ingredients already used in the cosmetics sector, 10% depend on new
to market or new to cosmetics market ingredients.

Overview Cosmetic Products

Product portfolio per manufacturer: || Colipa 10 000 (SME 160) ECEAE 592 (SME 40)

Total products: || Estimated between 100 000 and 300 000

Products reformulated: || 25-30% per year

Reformulation depending on new to market and new to cosmetics market ingredients: || 10% (of the 25-30%) = 2.5% to 3%

Source: Colipa, ECEAE and UEAPME submission to
Targeted Stakeholder Consultation

Annex 6:
Overview of Cosmetic Ingredients Portfolio and Changes

Cosmetic products consist of between 5 to
60 ingredients each. Overall it can be estimated that there are more then 19
000 cosmetic ingredients globally. CosIng lists 19 391 ingredients and 2099 substances[82].
Looking at the INCI numbers over the last years approximately 500 new International
Nomenclature of Cosmetic Ingredients (INCI) names are introduced per year. As
regards the positive lists in the Cosmetics Directive they currently contain 29
UV filters, 58 preservatives and 153 colorants. However, in reality the
number of ingredients actually used by manufacturers is far lower than these
numbers would suggest. According to data submitted by Colipa in the
stakeholder consultation, large cosmetics companies have an ingredient
portfolio of 2000 ingredients and SMEs of 600 ingredients. This makes up the
toolbox companies use for product formulation.

According to Colipa data, large companies
introduced around 80 new ingredients per year between 2000 and 2009 (SMEs 22), representing
around 4% of their ingredient portfolio. This represents the key
innovation pool for industry. In 2010, 60 new ingredients were introduced by
the participating large companies (SMEs 26). Less than 10% of these new
ingredients are covered by the Annexes of the Cosmetics Directive.

However, the number of new ingredients
introduced varies considerably between companies. The range given by large companies
was between 0 and 734. While some cosmetic manufacturers may have more
'conservative' product lines or may innovate and/or grow more based on
marketing strategies, others very much depend on innovative ingredients and
products.

According to data supplied by ECEAE in the
stakeholder consultation, large companies have a portfolio of 11500 ingredients[83], small companies have a
portfolio of 151 ingredients. Large companies participating in the ECEAE survey
added 15 ingredients per year, SMEs added 9 to their portfolio.

From this data it is not possible to
deduce a total number of new ingredients introduced per year for the entire industry (the numbers above relate
to manufacturers), as each ingredient can and will be used by several companies
and in a variety of products. Proprietary ingredients developed by cosmetic
companies themselves would typically be used first exclusively and then be
provided to the wider market
under license.

However, data from EfFCI gives a minimum indication
of total numbers; it estimates that from the ingredient manufacturer side in
last 10 years around 1100 new substances – thus about 100 per year - were
supplied by large companies to the cosmetics market, including substances
used already in other sectors. A large supplier is estimated to introduce on
average 5 new ingredients per year. In addition SME´s introduce 2 to 3 new
ingredients per year. In particular for botanical natural complex substances
the European Organization of Cosmetic Ingredients Industries and Services (Unitis)
informed that each company produced since 2000 each year several new
ingredients from known or new plants. Hundreds of new botanical natural
complex substances were made available to the cosmetics industry. These
substances are in particular in demand as there is a strong consumer demand for
more natural cosmetics. Ingredients are mostly sourced from ingredient
suppliers. However 60% of large companies produce at least some ingredients
themselves - according to Colipa data between 1 and 5 new ingredients a year
per company. Taken together, this would indicate that at a minimum
approximately 150 new ingredients are introduced per year.

On the other hand, up to 500 new INCI codes
are introduced per year. This represents the maximum of new ingredients per
year. It is however likely to be a very high estimate and most stakeholders
considered that the actual number of new cosmetics ingredients in the EU is
lower than that. The reasons were that INCI is not exclusive to cosmetics,
covers ingredients worldwide and also mixtures.

To illustrate the link between ingredients
and products, below the example of a frame formulation for a sunscreen cream is
provided and an example of a formulation. Frame Formulations detail the type of
ingredients and their maximum concentration for most cosmetic products on the
European market. They are used to provide information to poison centres and are
included in the new Cosmetic Products Notification Portal (CPNP).

EXAMPLE
SUNSCREEN cream:

Frame formulation Number:            9.1 - 2011

SUNSCREEN CREAM,
LOTION

Ingredients      Maximum

                                                                                                                      levels
(% w/w)

Oils (e.g. vegetable and/or mineral), waxes
and fats

(e.g. long chain alcohols)                                                                                             70

UV filters                                                                                                                       40

Silicones including volatile
silicones (e.g. cyclopentasiloxane, dimethicone)            30

Humectants (e.g. glycerin, propylene
glycol)                                                              30

Ethanol (alcohol, alcohol
denat.)                                                                                 25

Emulsifying agents (e.g. glyceryl
stearate, PEG-100 stearate)                                 10

Bulking agents (e.g. talc, silica,
nylon powder)                                                           10

Additional ingredients (e.g. bisabolol,
vitamins)                                                             6

Film forming polymers (e.g. PVP)                                                                                 5

Thickeners (e.g. carbomer, xanthan
gum)                                                                    5

Parfum                                                                                                                           3

Preservatives, antimicrobials                                                                                        2

Colorants                                                                                                                       2

Aqua                                                                                                                       to
100

Actual Product Example:

Ingredient (from example) || Use (according to COSING)

Aqua || Solvent

C12 C15 Alkyl benzoate || Antimicrobial, Emollient, Skin conditioning

Glycerin || Denaturant, Humectant, Masking, Perfuming, Skin protecting, Viscosity controlling

Ethylhexyl salicylate || UV absorber, UV filter

Titanium dioxide || Opacifying, UV absorber, UV filter

Butyl methoxydibenzoylmethane || UV absorber, UV filter

Bis-ethylhexyloxyphénol Methoxyphenyl triazine || Skin conditioning, UV absorber, UV filter

Alcohol Denat || Antiforming, Antimicrobial, Astringent, Masking, Solvent, Viscosity controlling

Pentylène glycol || Skin conditioning, Solvent

Octocrylene || UV absorber, UV filter

Cyclopentasiloxane || Emollient, Skin conditioning, Solvent

Stearic acid || Cleansing, Emulsifying, Emulsion stabilising, Masking, Refatting, Surfactant

Potassium cetyl phosphate || Surfactant

Dimethicone || Surfactant, Antifoaming, Emollient, Skin conditioning, Skin protecting

Methyl methacrylate crosspolymer || Film forming

Myristyl myristate || Emollient, Opacifying, Skin conditioning

Nylon-12 || Bulking, Opacifying, Viscosity controlling

Petrolatum || Antistatic,Emollient

Ethylhexyl triazone || UV absorber, UV filter

Aluminium hydroxide || Cosmetic colorant, Emollient, Humectant, Opacifying, Skin Protecting, Viscosity controlling

Ammonium Polyacryloyldilmetyl taurate || Emulsion stabilising,Viscosity controlling

Caprylyl glycol || Emollient,Humectant,Skin conditioning

Cassia alata leaf extract || Astringent

CI 77491 (IUPAC Name: iron oxides) || Cosmetic colorant

CI 77492 || Cosmetic colorant

CI 77891 (INN Name: Titanium Dioxide) || Cosmetic colorant

Disodium edta || Chelating, Viscosity controlling

Drometrizole trisiloxane || UV absorber, UV filter

Glyceryl stearate || Emollient, Emulsifying

Hydroxylpropyl methylcellulose || Antistatic, Binding, Emulsion stabilising, Film forming, Surfactant, Viscosity controlling

Maltodextrin || Absorbent, Binding, Emulsion stabilising, Film forming, Skin conditioning

PEG 100 Stearate || Surfactant

Phenoxyethanol || Preservative

Stearyl alcohol || Emollient, Emulsifying, Emulsion stabilising, Foam boosting, Masking, Opacifying, Refatting, Surfactant, Viscosity controlling

Terephthalylidene dicamphor sulfonic acid || UV Absorber, UV Filter

Tocopherol || Antioxidant, Masking, Skin conditioning

Triethanolamine || Buffering, Emulsifying, Masking, Surfactant

Only 10% of the ingredients introduced
into the portfolio are estimated to be new to the market. 90% are/have been used in other sectors, including cosmetic
products outside the EU, food,
pharmaceuticals, detergents and are covered by REACH.

Ingredients do not all have the same
importance and value. While no data was provided by stakeholders on actual
individual ingredient value, it is clear that some ingredients, such as
preservatives, are used in a large portion of cosmetic products, have a key
functionality and are therefore much more difficult to replace. Equally, new
ingredients with a specific and innovative function, eg. in anti-ageing
products, may produce a much higher industry value than a new colorant.

Ingredients are added to and taken out the
portfolio for various reasons. In 2010 according to Colipa data more
ingredients were taken out of the portfolio then added to it. On average large
companies removed 120 ingredients from their portfolio in 2010 and SMEs removed 10. The main reasons for
removing ingredients were regulatory constraints, followed by safety
considerations, poor performance and/or quality. The reason to introduce new
ingredients is in over 50% of the cases better performance and quality,
including better tolerance (e.g. anti-ageing properties, more natural,
biological/organic, new categories (sprays), better tolerance). However,
environmental reasons were also considered important. In an effort towards more
sustainability the cosmetics industry replaces e.g. more and more silicon,
mineral oils and synthetic alcohol. Very often a new ingredient will lead to a
better performance eg. better consistency, innovation is therefore often
rather incremental.

Source: Colipa
Submission to Targeted Stakeholder Consultation

Examples of innovation:

- A superior skin moisturisation ingredient
has been introduced by company A. Four different formulations were launched in
the EU using technology based on this ingredient and this resulted in
significant growth for the brand.

- Development of ingredients to obtain
odourless self-tanning.

- A natural ingredient to
formulate silicone-free products (highly soluble, absorbs oil at higher levels, enhancing its
emulsifying effect). It contains an extremely low microbial count reducing the
need for preservatives, is low cost and has enhanced anti-irritant properties.

- A large part of the patent activity in the
cosmetics industry appears to be in the field of peptides. Peptides stimulate
skin regeneration, but in order to be effective, a high concentration of
peptides is needed, without causing any irritation to the skin. Peptides are
already in use, so here innovation would mainly mean enhancements.

Overview Ingredients

Ingredients portfolio per manufacturer: || Colipa 2000 (SME 600), ECEAE 11 500 (SME 151)

Ingredients added per year per manufacturer: || Colipa 70 (SME 22) = 4%, ECEAE 15 (SME 9)

New to market ingredients: || Out of these 4% added ingredients only 10% new to market = 90% used in other sectors, thus new only to cosmetics market

Total ingredients added per year: || Overall at least 100 (EfFCI)

Ingredients removed: || Removed: Between 2000 and 2009 Colipa 24 (SME 6), but in 2010 120 (SME 10)

Source: Colipa, EfFCI and ECEAE submissions
to the Targeted Stakeholder Consultation

Annex 7: Glossary

Alternative methods:

Methods that provide the same or higher
levels of information as those obtained in procedures using animals, but which do not involve the use of animals or use
fewer animals or which entail less painful procedures. In the context of the
Cosmetics Directive only methods that do not involve the use of animals are
relevant (not reduction and refinement).

Carcinogenicity:

A specific endpoint on repeated dose
toxicity is carcinogenicity. Carcinogenesis is a complex long-term
multi-factorial process, and consists of a sequence of stages. Carcinogens have
conventionally been divided into two categories according to their presumed mode of action: genotoxic
carcinogens that affect the integrity of the genome by interacting with DNA
and/or the cellular apparatus, and non-genotoxic carcinogens that exert their
carcinogenic effects through other mechanisms.

Cosmetic ingredients:

‘ingredients’ means any chemical substance or preparation of synthetic or natural
origin, including perfume and aromatic compositions used in composition of
cosmetic products (see Commission Recommendation Establishing guidelines on the
use of claims referring to the absence of tests on animals pursuant to Council
Directive 76/768/EEC, (2006/406/EC)).

Cosmetic product:

‘cosmetic product’ means any substance
or mixture intended to be placed in contact with the external parts of the human body (epidermis, hair system, nails,
lips and external genital organs) or with the teeth
and the mucous membranes of the oral cavity with a view exclusively or mainly
to cleaning them, perfuming them, changing their appearance, protecting them,
keeping them in good condition or correcting body odours; (see Article 2, 1 (a)
of Regulation 1223/2009)

Marketing ban:

As from March 2009, it is prohibited in
the EU to market cosmetic products and their ingredients which have been tested
on animals, irrespective of the origin of these products. This marketing ban
applies to all but the most complex human health effects to be tested to demonstrate the safety of cosmetic products
(repeated-dose toxicity including skin sensitisation and carcinogenicity,
reproductive toxicity and toxicokinetics), for which the legislator extended
the deadline to March 2013 (see Article 4a,1 (a) and (b) of Directive
76/768/EEC and Article 18 1 (a) and (b) of Regulation 1223/2009).

New to cosmetics market ingredient:

A cosmetic ingredient that is new to use
in the cosmetics sector, but has been used already in other sectors.

New to market ingredient:

A cosmetic
ingredient that has not been used in other sectors before either, thus is completely new.

Repeated-dose toxicity:

Repeated dose toxicity occurs if a
persistent or progressively deteriorating dysfunction of cells, organs or multiple organ systems, results
from long-term repeated exposure to a chemical.

Reproductive toxicity:

Reproductive toxicity refers to a wide
variety of adverse effects that may occur in different phases within the
reproductive cycle, as a consequence of one or more exposures to a toxic substance, including
effects on fertility, sexual behaviour, embryo implantation, embryonic/foetal
development, parturition, postnatal adaptation, and subsequent growth and
development into sexual maturity.

Skin sensitisation:

One specific endpoint to assess repeated dose toxicity is skin sensitisation.
This is the toxicological endpoint associated with chemicals that have the
intrinsic ability to cause skin allergy.

Toxicokinetics:

Toxicokinetics informs about the penetration into and fate within the body of a
toxic substance, including its absorption, distribution, metabolism (producing
less toxic metabolites (detoxification) or in some cases more toxic
metabolites) and excretion.

Testing ban:

A ban of animal testing of finished
cosmetic products has been in force since September
2004 and a testing ban on ingredients or combinations of ingredients since
March 2009 (see Article 4a,1 (c) and (d) of Directive 76/768/EEC and Article 18
1 (c) and (d) of Regulation 1223/2009).

\*          \*          \*

[1]               Council Directive of 27 July 1976 on the
approximation of the laws of the Member States relating to cosmetic products,
OJ L 262, 27.9.1976, p. 169.

[2]               See for the grouping of endpoints under the 2013
marketing ban: Commission Staff Working Document, Timetables for the
phasing-out of animal testing in the framework of the 7th Amendment
to the Cosmetics Directive (Council Directive 76/768/EEC), 1.10.2004, SEC(2004)
1210

[3]               Report on the Development, Validation and Legal
Acceptance of Alternative Methods to Animal Tests in the Field of Cosmetics
(2009), 13.9.2011, COM(2011) 558 final

[4]               Now the European Union Reference Laboratory for
Alternatives to Animal Testing (EURL ECVAM)

[5]               Now named Cosmetics Europe

[6]               See: http://ec.europa.eu/consumers/sectors/cosmetics/documents/public\_consultation/index\_en.htm All Internet links provided in the footnotes of this report
were last accessed on 24 August 2012

[7]               Directorate-General SANCO's "Code of Good
Practice For Consultation of Stakeholders", see http://ec.europa.eu/dgs/health\_consumer/dgs\_consultations/docs/code\_good\_practices\_consultation\_en.pdf

[8]               See: http://ec.europa.eu/consumers/sectors/cosmetics/documents/animal-testing/index\_en.htm

[9]               See European Coalition to End
Animal Experiments contribution to
the consultation and BUAV publication: Meeting the Deadline of the 2013 EU
Marketing Ban. A Scientific Review of Non Animal Tests for Cosmetics, 2011

[10]             Memorandum on "Alternative Test Methods in Human
Health Safety Assessment of Cosmetic Ingredients in the European Union",
SCCS/1294/10, see: http://ec.europa.eu/health/scientific\_committees/consumer\_safety/docs/sccs\_s\_001.pdf

[11]             EFSA: Existing approaches incorporating replacement,
reduction and refinement of animal testing: applicability in food and feed risk
assessment, Opinion of the Scientific
Committee/Scientific Panel, Question No EFSA-Q-2005-231, See: http://www.efsa.europa.eu/en/efsajournal/doc/1052.pdf
Echa: 'The Use of Alternatives to Testing on Animals for the Reach Regulation',
2011 http://echa.europa.eu/documents/10162/13639/alternatives\_test\_animals\_2011\_en.pdf

[12]             An Expert Consortium Review of the EC-commissioned
Report “Alternative (Non-Animal) Methods for Cosmetics Testing: Current Status
and Future Prospects – 2010”, Altex 28, 3/11

[13]             See:

http://ec.europa.eu/consumers/sectors/cosmetics/documents/animaltesting/stakeholders\_consultation\_en.htm

[14]             Directorate-General SANCO's "Code of Good Practice
For Consultation of Stakeholders", see http://ec.europa.eu/dgs/health\_consumer/dgs\_consultations/docs/code\_good\_practices\_consultation\_en.pdf

[15]             See: http://ec.europa.eu/consumers/sectors/cosmetics/documents/revision/index\_en.htm

[16]             The Colipa submission is based on the input of 24 large
companies (accounting for a major part of EU production) and 100 SMEs (from
France, Italy, Spain, Germany and UK as main producing countries, as well as
other countries such as Poland and Bulgaria)

[17]             The Leaping Bunny trademark certifies compliance with
the criteria of the Humane Standards, which are in the EU managed by ECEAE; 25
cosmetic and personal care companies from the UK, France, Germany, Sweden and
Denmark were consulted – 2 of them were large, the rest SMEs.

[18]             Cosmetics Committee: 08.02.2010, 08.11.2010,
08.02.2011, 14.06.2011, Working Group: 23.06.2010, 08.02.2011, 14/15.06.2011

[19]             Humane Society International, Cruelty Free 2013

[20]             Letter from Intergroup to Commissioner Dalli of 16
February

[21]             Regulation (EC) No 1223/2009 of the European Parliament
and of the Council of 30 November 2009 on cosmetic products, OJ L 342,
22.12.2009, p. 59-2009

[22]             Impact assessment - Report on
simplification of the “Cosmetics Directive” – Directive 76/768/EEC (COM(2008)49
final) (SEC(2008)118) /SEC/2008/0117 final, also accessible under http://ec.europa.eu/consumers/sectors/cosmetics/documents/revision/index\_en.htm#h2-impact-assessment-report

[23]             See: http://www.rpaltd.co.uk/documents/J574Cosmetics2.pdf

[24]             See: http://ec.europa.eu/enterprise/newsroom/cf/\_getdocument.cfm?doc\_id=4562

[25]             Cosmetics Europe, Report of Euromonitor International,
2010

[26]             Global Insight, A Study of the European Cosmetics
Industry

[27]             COLIPA, Euromonitor International, 2010

[28]             COLIPA, Euromonitor International, 2010

[29]             Comparative Study on Cosmetics Legislation in the EU
and Other Principal Markets with Special Attention to so-called Borderline
Products, DG ENTR, 2004 and Colipa submission to Targeted Stakeholder
Consultation

[30]             Union for Ethical Bio Trade, A review of patent
activity in the cosmetics sector in the context of the ethical sourcing of biodiversity,
2010

[31]             See Article 10 (3) of Regulation (EC) 1223/2009 of the
European Parliament and the Council on cosmetics products, 22.12.2009, OJ L
342, p. 59 - 209

[32]             See Article 10 (3) of Regulation (EC) 1223/2009 of the
European Parliament and the Council on cosmetics products, 22.12.2009, OJ L
342, p. 59 - 209

[33]             Directive 93/35/EEC, OJ L 151, 23.06.1993, p. 0032-0037

[34]             Council Directive
86/609/EEC regarding the protection of animals used for experimental and other
scientific purposes OJ L 358, 18.12.1986, p. 1–28

[35]             Directive 97/18/EC, OJ L 114, 01.05.1997, p. 0043-0044

[36]             Directive 2003/15/EC, OJ L 66, 11.03.2003, p. 0026-0035

[37]             Directive 2000/41/EC, OJ L 145,
20.06.2000, p. 0025-0026

[38]             Available under: http://ec.europa.eu/consumers/sectors/cosmetics/documents/animal-testing/index\_en.htm

[39]             Regulation (EC) No 1907/2006 of the European Parliament
and of the Council of 18 December 2006 concerning the Registration, Evaluation,
Authorisation and Restriction of Chemicals (REACH), establishing a European
Chemicals Agency, amending Directive 1999/45/EC and repealing Council
Regulation (EEC) No 793/93 and Commission Regulation (EC) No 1488/94 as well as
Council Directive 76/769/EEC and Commission Directives 91/155/EEC, 93/67/EEC,
93/105/EC and 2000/21/EC, Official Journal L 136, 29.5.2007, p. 3.

[40]             Directive 2010/63/EU on the protection of animals used
for scientific purposes, OJ L 276, 20.10.2010, p.33

[41]             Regulation (EC) No 1907/2006 of the European Parliament
and of the Council of 18 December 2006 concerning the Registration, Evaluation,
Authorisation and Restriction of Chemicals (REACH), establishing a European
Chemicals Agency, amending Directive 1999/45/EC and repealing Council
Regulation (EEC) No 793/93 and Commission Regulation (EC) No 1488/94 as well as
Council Directive 76/769/EEC and Commission Directives 91/155/EEC, 93/67/EEC,
93/105/EC and 2000/21/EC, Official Journal L 136, 29.5.2007, P. 3

[42]             Commission Proposal for a Regulation of the European
Parliament and the Council concerning the placing on the market and the use of
biocidal products, COM (2009) 267 of 12.06.2009

[43]             Colipa and EFfCI submissions to the Targeted
Stakeholder Consultation

[44]             Colipa submissions to the Targeted Stakeholder Consultation

[45]             Colipa submissions to the Targeted Stakeholder Consultation

[46]             Colipa submissions to the Targeted Stakeholder
Consultation

[47]             Taylor, K., Gordon, N., Higgins, W. and Langley, G.
(2008) Estimates for worldwide laboratory animal use in 2005. Alternatives
to Laboratory Animals (ATLA). 36 (3); 327-42

[48]             Sixth Report from the Commission
to the Council and the European Parliament on the Statistics on the number of
animals used for experimental and other scientific purposes in the member
states of the European Union COM(2010) 511/final 2, http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0511:REV1:EN:PDF

[49]             'Food for Thought … on the Economic of Animal Testing',
Bottini and Hartung, Altex

[50]             Sixth Report from the Commission to the Council and the
European Parliament on the Statistics on the number of animals used for
experimental and other scientific purposes in the member states of the European
Union COM(2010) 511/final 2, see: http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0511:REV1:EN:PDF

[51]             Special Eurobarometer 340 / Wave 73.1 – TNS Opinion
& Social, June 2010

[52]             EURL ECVAM Recommendation of 14.03.12 on three Cell
Transformation Assays (CTA)

Using Syrian Hamster Embryo Cells
(SHE) and the BALB/c 3T3 mouse fibroblast cell line, see: http://ihcp.jrc.ec.europa.eu/our\_labs/eurl-ecvam/eurl-ecvam-recommendations/EURL-ECVAM%20-Recommendation.pdf

[53]             See: http://www.seurat-1.eu/

[54]             Colipa submission to Targeted Stakeholder Consultation

[55]             ECEAE submission to Targeted Stakeholder Consultation

[56]             Colipa submission to Targeted Stakeholder Consultation

[57]             Colipa submission to Targeted Stakeholder Consultation,
Note: the total number of ingredients introduced per manufacturer provided
there is 70, 4% of 2 000 is however 80 – the higher number of taken as a basis
here

[58]             Opinion SCCS/1484/12, see: http://ec.europa.eu/health/scientific\_committees/consumer\_safety/docs/sccs\_s\_005.pdf

[59]             Opinion SCCS/1348/10, see:

[60]             Global Insight, A Study of the European Cosmetics
Industry

[61]             Medium-sized: less than 250 employees, equal to or less
than € 50 m turnover or equal to or less than € 43 m balance sheet total

[62]             Micro enterprise: less than 10 employees, equal to or
less than € 2 m turnover or equal to or less than € 2 m balance sheet total

[63]             Impact assessment - Report on simplification of the
“Cosmetics Directive” – Directive 76/768/EEC (COM(2008)49 final) (SEC(2008)118)
/SEC/2008/0117 final, also accessible under http://ec.europa.eu/consumers/sectors/cosmetics/documents/revision/index\_en.htm#h2-impact-assessment-report

[64]             Communication from the Commission of 3 March 2010,
COM(2010)2020

[65]             Communication of the Commission on Europe 2010 Flagship
Initiative Innovation Union, 6.10.2010, COM(2010)546final

[66]             COM(2012) 6 final/2, 15.2.2012, see: http://ec.europa.eu/food/animal/welfare/actionplan/docs/aw\_strategy\_19012012\_en.pdf

[67]             Such as in Article 4 of Directive 2010/63/EU on the
protection of animals used for scientific purposes

[68]             See Article 4a, 2.4. of Directive 76/768/EEC

[69]             Extensive guidance on the Socio-Economic Analysis in
these cases exists: http://echa.europa.eu/documents/10162/13637/sea\_authorisation\_en.pdf

[70]             Article 5 of Directive 2011/65/EU of the European
Parliament and of the Council of 8 June 2011 on the restriction of the use of
certain hazardous substances in electrical and electronic equipment, L 174, 1.7.2011,
p. 8 ff.

[71]             Impact Assessment Guidelines (SEC(2009)92, Part III,
page 45

[72]             Impact assessment - Report on
simplification of the “Cosmetics Directive” – Directive 76/768/EEC (COM(2008)49
final) (SEC(2008)118) /SEC/2008/0117 final, also accessible under http://ec.europa.eu/consumers/sectors/cosmetics/documents/revision/index\_en.htm#h2-impact-      assessment-report

[73]             The underlying cost elements are described in the Impact
assessment - Report on simplification of the “Cosmetics Directive” – Directive
76/768/EEC (COM(2008)49 final) (SEC(2008)118) /SEC/2008/0117 final and partly
based on the RPA study "Impact of European Regulation on the EU Cosmetics
Industry" of September 2007

[74]             See: http://ec.europa.eu/consumers/sectors/cosmetics/documents/public\_consultation/index\_en.htm All Internet links provided in the footnotes of this report
were last accessed on 24 August 2012

[75]             See:http://ec.europa.eu/consumers/sectors/cosmetics/documents/animal
testing/stakeholders\_consultation\_en.htm

[76]             On the basis of undesirable effects notified in France
to the responsible market surveillance authority in 2005

[77]             The
SCCS's Notes of Guidance for the Testing of Cosmetic Ingredients and their
Safety Evaluation, 7th http://ec.europa.eu/health/scientific\_committees/consumer\_safety/docs/sccs\_s\_004.pdf

[78]             Safety Assessment of Cosmetics in Europe. Rogiers V and
Pauwels M (Eds), Current Problems in Dermatology Vol. 37 (2008). S. Karger,
Basel, CH, ISBN 978-3-8055-8655-9

[79]             The TTC concept aims to establish a human exposure
threshold value below which there is a very low probability of an appreciable
risk to human health, applicable to chemicals for which toxicological data are
not available and based on chemical structure and toxicity data of structurally
related chemicals. Opinion SCCP/1171 on the Use of the Threshold of
Toxicological Concern (TTC) Approach for Human Safety Assessment of Chemical
Substances with focus on Cosmetics and Consumer Products, http://ec.europa.eu/health/scientific\_committees/consumer\_safety/docs/sccs\_o\_092.pdf

[80]             'The use of alternatives to testing on animals for the
REACH Regulation 2011', ECHA-11-R-004.2-EN

[81]             This will change with the full implementation of the Cosmetic
Products Notification Portal (CPNP) by July 2013

[82]             See: http://ec.europa.eu/consumers/cosmetics/cosing/
, Substances are those that are regulated under one of the Annexes of the
Cosmetics Directive, ingredients are not.

[83]             Note: this figure is not coherent with overall
information available and may be based on a mistake

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