Bills Digest no. 189 2007–08
Industrial Chemicals (Notification and Assessment) Amendment (Cosmetics)
Bill 2007
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage history
Purpose
Background
Financial implications
Main provisions
Concluding comments
Endnotes
Contact officer & copyright details
Passage history
Industrial
Chemicals (Notification and Assessment) Amendment (Cosmetics) Bill 2007
Date introduced:
13 June 2007
House:
House of Representatives
Portfolio:
Health and Ageing
Commencement:
Sections 1 to 3 commence on Royal Assent. Schedules
1 and 2 (containing the main operative provisions) commence 28 days after
the Act receives the Royal Assent.
The purpose of the Bill is to amend
the Industrial Chemicals (Notification and Assessment) Act 1989
to:
- provide legislative underpinning for recent reforms to the regulation
of cosmetics in Australia,
which currently only exist on a limited, interim, administrative basis.
The reforms concern chemicals in cosmetics which are considered to be
of low regulatory concern.
- enable the Minister to make standards by legislative instrument,
for cosmetic products as a whole that are imported into, or manufactured
in, Australia.
- include a criminal offence for importing into, or manufacturing in,
Australia
a cosmetic that is subject to the standard and does not meet the standard.
- make minor changes to the Act of a technical or uncontroversial nature,
so as to improve the clarity, increase consistency, and address minor
technical anomalies or unintended effects of the legislation.
The Industrial Chemicals (Notification and Assessment)
Act 1989 (the Act) establishes a system of notification and assessment
of industrial chemicals to protect health, safety and the environment
and to provide for registration of people or companies proposing to introduce
industrial chemicals into Australia. (1)
The National Industrial Chemicals Notification and Assessment
Scheme (NICNAS) administers the Act and is located within the Commonwealth
Department of Health and Ageing. Established in 1990,
it sits within the Office of Chemical Safety, which in turn sits within
the Therapeutic Goods Administration (TGA) Group of Regulators.(2)
NICNAS deals directly with the industry and the public in issuing permits,
providing advice, and publishing the Chemical Gazette.
As part of the Government’s broader initiatives to reduce
regulation, NICNAS established the Low Regulatory Concerns Chemical Taskforce.
The Taskforce was enlisted to examine possible reforms to the systems
of regulation of chemicals that were deemed to be of ‘low regulatory concern’.(3)
The Taskforce, with the aid of the Cosmetics Implementation Working Group,
subsequently released a report in 2005 entitled Regulation
of Cosmetic Chemicals: Final Report and Recommendations.(4)
The report’s recommendation for reforms to cosmetics regulation was endorsed
by Government. It was understood that the reforms would be achieved by
legislative reform. In addition, a Regulatory
Impact Statement was produced.(5)
The Explanatory Memorandum details the major objectives
of the agreed reforms suggested by the final report. (6)One
of the primary objectives of the reforms is to clarify the respective
roles and responsibilities of NICNAS and TGA in regards to regulation
of cosmetic chemicals, with an appropriate apportionment of regulatory
effort depending on the chemical’s level of risk. The final report explained
the relative roles of the organisations:
NICNAS is a chemical entity based notification and risk
assessment scheme (as opposed to the TGA that operates a product registration
scheme), where all ingredients in a product require assessment if not
already entered on the Australian Inventory of Chemical Substances (AICS)
(unless subject to exemptions, when various compliance safeguards apply).
Where products are reclassified as cosmetics, each individual ingredient
not already listed on the AICS will require assessment or transfer onto
the inventory through another acceptable mechanism.
Therefore, NICNAS and the TGA, in consultation with all
industry stakeholders will establish an appropriate mechanism for the
transfer of chemicals not listed on the AICS and currently included
in products proposed for reclassification ensuring minimum impact on
industry.
Other objectives of
the reforms are:(7)
- improved regulation at the interface for identified product types,
including changes that could enhance the transparency and useability
of existing regulatory documents; and
- specifically addressing issues dealing with antiperspirants, mass-market
antidandruff shampoos, moisturisers with SPF, antibacterial skin washes,
and anti-acne cleansers.
In 2006, the NICNAS Cosmetic Guidelines were introduced.
The Guidelines, which implement the recommendations of the final report,
provide for the current system of regulating cosmetics. However, permits
issued under the Guidelines are administrative in nature; no penalties
can be imposed for non-compliance.(8) The current system depends
on industry compliance to meet the standards within the Guidelines. Further,
there are some categories of cosmetics (such as skin
whitening products and anti-ageing products) that are not subject to
the interim arrangements and will not come within the remit of NICNAS
until the legislative changes take effect.(9)
The current administrative system of regulation was introduced
as an interim measure, to eventually be replaced by a legislative framework.
The Industrial Chemicals (Notification and Assessment) Amendment (Cosmetics)
Bill (“ICAC Bill”) puts forward that framework.
The intended effect of the reforms is to also
increase international harmonisation with Australia’s
key trading partners and ensure greater access to the reforms for all
relevant cosmetics products (reducing the regulatory burden and costs
to industry).(10)
On 14 June 2007,
the Sydney Morning Herald published an article regarding the release
of a Federal Government warning about a brand of imported toothpaste which
was found to contain a toxic substance. The article was coincidently released
in the same week as the ICAC Bill’s introduction in Parliament. The article
reported:
“A spokeswoman for the Department of Health and Ageing
said the scheme already had the power to restrict the use of (the toxic
substance) in products, but was now considering launching an in-depth
review of the chemical to determine whether further regulatory action
was needed, either through labelling or restriction on use in products.”(11)
The article proceeded to outline the proposed new powers
of the Government under the ICAC Bill, to set a national standard for
cosmetic products.
The Explanatory Memorandum states that the legislative
underpinning of the current system is to be supported by all interest
groups. NICNAS consulted widely with a broad range of stakeholders, including
the cosmetics industry and its industry bodies; government and non-government
organisations; and worker and community representatives.(12)
The Explanatory Memorandum states that the initiatives
are cost neutral.(13)
The Explanatory Memorandum provides detailed coverage
of the provisions of the Bill. The following analysis summarises the provisions
on a general basis.
Schedule 1 amends the Act so that it applies to
cosmetics, as well as industrial chemicals. These amendments ensure that
the Act applies to cosmetics products that have been imported into, or
manufactured in, Australia
(as well as the basic chemical ingredients used in manufacturing them).
The extension of the Act’s scope enables NICNAS to easily deal with chemicals
that are already contained within finished cosmetic products.
Item 2 proposes amendment to section 3 ‘Objects
of Act’. The proposed new section contains an additional object
which is to provide for national standards for cosmetics imported into,
or manufactured in, Australia
and the enforcement of those standards.(14)
Item 11 proposes the insertion of Part 3B ‘Standards
for cosmetics imported into, or manufactured in, Australia.’
Proposed section 81 allows the Minister to set national standards
for cosmetic products, by legislative instrument. The Explanatory Memorandum
states that the NICNAS will make the standard publicly available — this
is in addition to registration of the instrument on the Register of Legislative
Instrument and publication in the Chemical Gazette.
Enforceability of section 81 is supported by an offence
provision (proposed section 81A) for non-compliance with the standard,
punishable with 120 penalty units - equating to $66,000 for a corporation.
This penalty is comparable in size to an existing penalty for a similar
offence of non‑compliance in relation to chemicals (section 15A
of the Act).
Part 1 of Schedule 2 (Items 1-9)
amends various sections to replace references to ‘calendar year’ with
‘12 month period’. This amendment is to create consistency in drafting
throughout the Act and prevent confusion.
Part 2 (Items 10-13) also promotes
consistency in drafting, by bringing sections 21ZB and 22O in line with
section 21P. All three sections allow permit applicants to request that
certain information they provide be treated as ‘exempt information’ under
section 75 of the Act.(15)
Part 3 (Items 14-16) also promotes consistency
in drafting, by bringing section 21F in line with similar sections 21SA
and 22D. All three sections allow the Director to request further information
from an applicant for the purposes of considering an application for a
permit.
Item 17 changes references in paragraphs 28(8)(a)
and (b) from ‘biopolymer’(16) to ‘polymer’. The Explanatory
Memorandum notes that this amendment corrects an unintended exclusion
of polymers that are not biopolymers. While it is noted that the provision
was not intended to exclude other polymers, the consequences of ‘widening’
the scope of this provision are unclear.
Item 20 repeals section 77 of the Act, that requires
a person who introduces a chemical pursuant to an assessment certificate
to, within 7 days, give written notice to the Director that they have
done so.
The Explanatory Memorandum states that the section is
being repealed due to lack of necessity, as compliance with the section
is not linked to any NICNAS regulatory activities. It is also noted that
there has been ‘limited compliance’ with the section since it was introduced
in 1990. The provision does not contain any penalties for non-compliance;
it is unclear how instances of non-compliance have been dealt with by
the agency to date.
Items 21-27 introduce the concept of ‘chemical
name’ in relation to the publication of notices about chemicals. A ‘chemical
name’ of a chemical can vary according to the type of chemical (pure vs.
unpure). The amendments clarify the source of a chemical name, and allow
for its use in various circumstances.
Items 28 – 33 deal with exempt information in
relation to annual reporting obligations. The amendments facilitate the
confidential treatment of information that is exempt from reporting requirements,
for reasons of commercial confidentiality.
Concluding comments
This Bill seeks to enforce a system that has been administratively
practiced by NICNAS since early 2006. The amendments to the Act enable
the system for regulating cosmetics to be enforced, supporting it with
penalties and Ministerial powers to set standards. Legislating these measure
will increased certainty for industry and provide clarity about industry
obligations, rights and responsibilities under legislation regarding cosmetic
chemicals.
- Peter
Prince, Industrial Chemicals (Notification and Assessment)
Amendment Bill 2003, Bills Digest
No.167 2002-03, Parliamentary Library, Canberra,
4 June 2003, at http://www.aph.gov.au/library/pubs/bd/2002-03/03bd167.htm,
accessed 18 June 2007
- Theraputic Goods Administration
– organisational structure. at http://www.tga.gov.au/docs/html/orgchart.htm,
accessed 19 June 2007
- Hon Chris Pyne MP, Minister
for Ageing, Industrial Chemicals (Notification and Assessment) Amendment
(Cosmetics) Bill 2007 (Second reading
speech), House of Representatives, Debates, 13 June 2007.
- http://www.nicnas.gov.au/Cosmetics/Regulation_Cosmetic_Chemicals
Final_Report_PDF.pdf, accessed 18 June 2007.
- http://www.nicnas.gov.au/About_NICNAS/Reforms/LRCC/Regulation
Impact_Statement_PDF.pdf, accessed 20 June 2007.
- Explanatory Memorandum,
p. 2.
- ibid.
- Hon
Chris Pyne, op. cit.
- ibid.
- ibid.
- Kelly
Burke, Alert issued over toxic toothpaste, Sydney
Morning Herald, p. 5.
- Explanatory Memorandum,
p. 8.
- ibid, p. 1.
- ibid, p. 11.
- A section 75 exemption
allows for information to be exempt from publication, if publication
could reasonably be expected to prejudice substantially the commercial
interests of the applicant; and if the prejudice outweighs the public
interest in the publication of the information.
- A ‘biopolymer’ is any
polymeric chemical manufactured by a living organism, as proteins and
polysaccharides.
PaoYi Tan
Law and Bills Digest Section
20 June 2007
Parliamentary Library
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