Small and medium-sized cosmetics manufacturers will be adversely affected and put at a disadvantage against multinational producers when the new Asean Harmonisation of Cosmetics Regulations come into full effect on January 1, 2008, the head of a major local producer said yesterday.

Somphong Tantivilaisin, chief executive officer of Advance Cosmetics Co Ltd, said the new regulations were based on the principle that manufacturers, importers and wholesalers of cosmetics are responsible for the safety, quality and claimed benefits of their products.

They must provide government control agencies with access to study findings and other reports detailing safety and product benefits, as well as adverse reactions associated with the products.

Government control agencies have a clear authority to inspect and examine cosmetics at the point of manufacture and anywhere in the market and inspect factories, in accordance with the Asean Guidelines on Cosmetics Good Manufacturing Practice.

"The Asean Harmonisation of Cosmetics Regulations scheme will allow local cosmetics producers to export their products freely without requiring approval from local FDAs [food and drug administrations]," said Somphong, who is also former director of the Thai Cosmetics Manufacturers Association.

"However, countries that import your cosmetics have full authority to make a post-audit of your goods, so [Thai makers] must declare all product formulas and ingredients, which are 'confidential assets'," he said.

Somphong said multinational cosmetics manufacturers with their own outlets at a particular export destination would have an advantage, because they would be allowed to keep their formulas and ingredients secret.

"This is quite different from small and medium-sized makers [particularly those who make cosmetics products under original-equipment manufacturing (OEM) contracts], who don't have their own foreign outlets, because they will have to reveal all of their production formulas and ingredients to outsiders," he said.

Somphong said concern with the new regulations involved non-tariff barriers, particularly for small and medium-sized cosmetics-makers requiring a large cash infusion to create transparent documents and systematic filing systems. Such manufacturers also rely on one major product as their cash cow and for which production formulas and ingredients are considered the most valuable and confidential asset.

Kwanchai Rungfapaisarn

The Nation