OCI observes China's cosmetics regulations and market trends

Foreword: From the continuous implementation of regulatory policies, to using technological innovation as a key turning point to promote the comprehensive upgrade of the cosmetics industry.

At this moment in 2026, the Lunar New Year has passed, and China's cosmetics industry is showing an unprecedented development pattern and structural differentiation under the dual promotion of "new regulation deep-water zone" and "marketization of survival and elimination". In the past year, the upstream raw material side has experienced an unprecedented "blowout" outbreak, with the number of new raw material registrations increasing by 87.8% year-on-year; while on the downstream finished product side, the registration volume of special cosmetics has dropped significantly by 26.8%. This scissor gap of "hot at the top and cold at the bottom" is not the decline of the industry, but the pain and rebirth of the deep transformation of China's beauty industry from "scale-driven" to "quality and technology-driven".

一、 Macro market: structural reversal on a trillion-dollar scale

1. Steady growth in total volume and increased pricing power of domestic products
 

Data source: National Bureau of Statistics

Data source: National Bureau of Statistics

According to data from the National Bureau of Statistics, the total retail sales of cosmetics in 2025 will be 465.3 billion yuan, a year-on-year increase of 5.1%. Although the growth rate has slowed down from the double-digit growth in previous years, this data demonstrates the resilience of the industry's rigid demand amid the pressure on the consumer environment. This growth rate is not only significantly higher than the 3.7% growth rate of total retail sales of consumer goods, but also slightly higher than the national GDP growth rate of 5.0%. It has changed from a year-on-year decline of 1.1% in 2024, showing a strong recovery trend.

Even more landmark is the scale of omni-channel transactions. According to data from the China Fragrances, Flavors and Cosmetics Industry Association, the market size will reach 1.104245 billion yuan in 2025, a year-on-year increase of 2.83%. Among them, domestic brands accounted for 57.37% of the transaction volume, officially regaining market dominance. Behind this reversal is the overall surpassing of domestic brands in terms of the rise of constituent parties, the deepening of live broadcast e-commerce, and the response speed of the supply chain.

2. Changes in channel depth: online is absolutely dominant
According to data from the China Fragrances, Flavors and Cosmetics Industry Association, in 2025, the online channel transaction volume of China's cosmetics market will reach 721.773 billion yuan, a year-on-year increase of 4.45%, accounting for 65.36%, becoming the absolute main battlefield. The solidification of this channel structure has forced the transformation of traditional offline channels, which has also made the cost of traffic acquisition extremely high, thus accelerating the elimination of white brands and small and medium-sized brands that have no core technology and only rely on "buying traffic".

二、 Raw material end: Blowout innovation and the rise of “Chinese core”

1. New raw materials: The rise of “Chinese core” behind 169 registrations
Since 2004, as of December 31, 2025, my country has registered 390 new raw materials, of which domestic raw materials account for as high as 87.9%. A total of 169 raw materials were registered in 2025, a year-on-year surge of 87.8%. Compared with 6 in 2021, the first year of the implementation of the new regulations, an increase of approximately 27 times was achieved in 2025. China's cosmetics industry is gradually breaking its long-term dependence on imported raw materials and beginning to build an independent and controllable raw material library.

"Behind these 169 new raw materials are huge challenges in testing and compliance. Among them, excellent local third-party compliance service agencies in China provide solid technical and service support for efficient and high-quality registration and filing of new raw materials. Beijing Zhengzhi Far East (OCI) Company is one of them. An excellent company, it has performed well in assisting the registration and filing of new raw materials in recent years, especially in 2025, especially in the category judgment of new raw materials, toxicological research, efficient declaration and publicity, etc., and continues to help accelerate the implementation of ‘China Core’.”

2. Innovation hotspots: two-wheel drive of plant resources and synthetic biology

• Chinese characteristic plant resources: Under the guidance of policies, characteristic plant-derived raw materials such as golden ear, rhodiola rosea, and bakuchiol have become popular for registration. There are 76 new plant raw materials throughout the year, accounting for 44.97% of the total registration amount in 2025.
• Synthetic biology and fermentation technology: A total of 16 new fermentation raw materials will be registered in 2025, accounting for 9.47% of the total registration volume in 2025, a year-on-year increase of 5.03 percentage points, with a growth rate of 300.00%. Microecological raw materials such as Bifidobacterium longum subspecies infantis and Kluyveromyces have become the core competitiveness of brands (such as Xiwuji, Kelanli, and Lin Qingxuan).
• Pharmaceutical cross-border: Pharmaceutical companies such as Vicki Pharmaceuticals and Jincheng Biotech have entered the market, bringing highly active peptide raw materials such as β-alanylhydroxyprolyldiaminobutyric acid benzylamine, raising the technical threshold of new raw materials.

3. Raw material gap and potential
Despite the explosive growth, compared with the more than 20,000 available raw material libraries in the EU and the United States, China's "Inventory of Used Cosmetic Raw Materials" (IECIC) in 2025 only includes about 8,977 types. This huge gap (about 2.2 times) is precisely the future growth space and the core driving force for the surge in new raw material registrations in 2025 - filling the "raw material gap".

三、Special Chapter: Policies and Regulations—Building a New Paradigm of “Safety + Innovation”

In 2025, China's cosmetics industry will usher in a critical year for the in-depth reconstruction of the regulatory system and the comprehensive upgrade of the regulatory mechanism. Under the double attack of "deep water zone of new regulations" and "consumption rationalization", the State Food and Drug Administration and relevant departments have intensively issued a series of policies, forming a dual supervision pattern of "safety bottom line + innovation engine", providing clear legal guarantee for the industry's transformation from "scale-driven" to "quality and technology-driven".

1. Top-level design: Improve the regulatory system with the "Regulations" as the core
The "Regulations on the Supervision and Administration of Cosmetics" is the fundamental law of the industry, and its supporting regulations will enter a period of intensive implementation in 2025. Throughout the year, national and local regulatory authorities issued more than 60 new regulations, covering the entire chain of raw material innovation, registration and filing, efficacy claims, and label management. The core logic is clear: strict "registration management" is implemented for high-risk special cosmetics and new raw materials, and efficient "registration management" is implemented for ordinary cosmetics and general new raw materials, achieving a balance between risk control and industrial vitality.

2. Raw material innovation: the implementation of the strongest incentive policy in history
In order to break the international monopoly on raw materials, on February 6, 2025, the State Food and Drug Administration officially implemented the "Several Provisions on Supporting the Innovation of Cosmetic Raw Materials". This is a core measure to implement the spirit of the Third Plenary Session of the 20th CPC Central Committee. It builds a collaborative system for raw material innovation from nine dimensions:

• Optimize technical requirements: For new raw materials used for the first time at home and abroad, some toxicological tests will be exempted based on scientific evaluation; for raw materials with a history of safe use (such as traditional characteristic plant resources), safety evaluation requirements will be simplified.
• Synchronous filing mechanism: Encourage simultaneous filing of new raw material declarations and registration of special cosmetics using the raw materials, significantly shortening the marketing cycle.
• Priority review channel: Implement "early intervention and full guidance" for new raw materials that use modern technology combined with China's traditional advantage projects and research and development of characteristic plant resources to accelerate the listing of "Chinese ingredients".
• Dynamic catalog management: Establish a dynamic adjustment mechanism for the "Catalogue of Used Cosmetic Raw Materials". The total number of raw materials included in the new version of the catalog in 2025 will reach 8,977. Although there is still a gap compared with the EU's 20,000+, it has laid the foundation for filling the "raw material gap".

3. Compliance threshold: the leap from “formal declaration” to “substantial safety”
2025 is a year when compliance costs will increase dramatically, and the regulatory focus will shift from "product declaration" to "full life cycle quality management":

• The full version of the safety assessment is mandatory: Starting from May 1, 2025, all special cosmetics registrations must submit a "full version of the safety assessment report" to replace the previous "simplified version". This requires companies to provide preservative challenge reports, physical and chemical property reports, compatibility reports and other measured data, which directly increases the registration cost of a single product by more than 5,000 yuan, extends the R&D cycle by 1-2 months, and eliminates a large number of speculative companies.
• "Data-based" efficacy evaluation: Documents such as "Technical Guidance Principles for Research on Anti-hair Loss Cosmetics (Trial)" are officially implemented, and the industry has completely bid farewell to "conceptual claims". The efficacy of whitening, sun protection, anti-hair loss, etc. must be verified through human efficacy tests or laboratory methods, and the summary must be disclosed on a designated website to accept social supervision.
• Comprehensive upgrade of the standard system: The State Food and Drug Administration issued 34 standard formulation and revision tasks at one time, involving new raw materials such as colloidal silver and bakuchiol, as well as product specifications such as hair perm and liquid foundation. At the same time, the State Food and Drug Administration has incorporated five new methods, including bovine corneal turbidity and in vitro skin allergy, into the "Safety Technical Specifications for Cosmetics", bringing the testing technology in line with high international standards.

4. Regulatory innovation: digitalization and precision in parallel
Supervision methods will realize the transformation from "human sea tactics" to "technical empowerment" in 2025:

• Electronic label pilot: Starting from February 1, 2026, a three-year cosmetic electronic label pilot will be launched in six provinces and cities: Beijing, Shanghai, Zhejiang, Shandong, Guangdong, and Chongqing. It allows full ingredients, implementation standards and other information to be displayed through QR codes. Physical labels are greatly simplified, reducing corporate packaging costs and improving environmental protection.
• Personalized service pilot: The second phase of the pilot was launched in 15 provinces (autonomous regions and municipalities), allowing companies to carry out simple deployment and packaging of small batches in offline stores according to consumer needs, but requiring service locations to be included in the quality management system, marking the shift of "customization" from a marketing concept to a compliance practice.
• Risk monitoring in advance: The "Cosmetics Safety Risk Monitoring and Evaluation Management Measures" will be implemented on August 1, 2025, and clearly include five major categories of risks such as substances that are prone to illegal additions and substances that are prone to causing health hazards to key groups such as children, into key monitoring, and promote the transformation of regulatory logic from "post-event sampling" to "pre-emptive prevention".

5. Special categories: strict control of toothpaste and children’s cosmetics

• New toothpaste regulations: On December 1, 2025, the "Toothpaste Classification Catalog (Draft for Comments)" was released, dividing the efficacy into eight categories and clearly stating the terms. At the same time, 7 inspection methods for hard particles and diethylene glycol in toothpaste have been included in the safety technical specifications. The new specifications will be implemented on March 1, 2026, and will significantly standardize the efficacy claims and quality and safety management of the toothpaste market.
• Children's safety: The State Food and Drug Administration has included 18 standards such as the "Limits of Total Count of Bacteria in Eye Cosmetics, Lip Cosmetics and Children's Cosmetics" in the formulation and revision project plan, and has put forward more stringent requirements for the limit of total bacterial colonies and the list of prohibited raw materials for children's cosmetics. Potential safety hazards of children's cosmetics have become the focus of supervision.

"Facing the most stringent 'full version safety assessment' and dynamic raw material catalog management in history, companies are in urgent need of professional compliance guidance. Beijing Zhengzhi Far East (OCI) Company has been holding public welfare seminars for more than 10 years, inviting industry experts to interact with companies online, making industry hotspots and pain points real issues and being solved. It has provided in-depth compliance consulting and full-chain solution services to more than 3,500 companies around the world, helping companies reduce compliance trial and error costs."

Conclusion:
The intensive implementation of regulations in 2025 is not a "curse" for the industry, but a "escort" for high-quality development. With the release of the "Opinions on Deepening the Reform of Cosmetics Supervision and Promoting High-Quality Development of the Industry" (24 articles), China's cosmetics supervision is moving towards the "international advanced level". For enterprises, compliance is no longer a multiple-choice question, but a matter of survival; only by basing "safety and efficacy" on solid toxicological and clinical data can we truly grasp the competitive initiative in the era of "technological dividends".

四、 Production and Compliance: Big Shuffle and Strong Supervision

1. Industry clearing is accelerating, and Guangdong clusters are “as stable as a rock”
According to data announced by local regulatory authorities, at least 203 companies nationwide have canceled their "Cosmetics Production Licenses" in 2025, continuing the trend of 1,318 companies being closed/cancelled in 2024. Although this data is dazzling, it is the only way for the industry to mature. This indicates the end of low-level repetitive construction and "workshop-style" production under the multiple pressures of tighter supervision, rising costs, and intensified market competition.

In the brutal reshuffle of 203 companies withdrawing, Beijing Zhengzhi Far East (OCI) Company has helped many cooperative companies pass the Food and Drug Administration inspection at one time through "flight inspection simulation" and "quality management system upgrade" services. We have always professionally escorted the safety of the company's entire chain, lighting up the beacon for Chinese beauty brands in the "deep water zone of new regulations".

At the same time, the cosmetics production side shows a strong regional agglomeration effect: official information released by the Guangdong Provincial Food and Drug Administration in June 2025 shows that as of May 20, 2025, there are more than 3,350 cosmetics manufacturers in the province, accounting for 55% of the national total. The number of registered cosmetics varieties in the province is about 1.6 million, accounting for 81% of the national total. It has built a complete closed-loop ecosystem from raw material supply, technology research and development to production and manufacturing, brand operation and marketing. With Guangdong as the absolute core and Guangzhou as the core engine, a super industrial cluster has been formed that occupies more than half of the country, has a complete industrial chain, and has strong innovation vitality. "More than 3,350 companies" and "more than 1.6 million products" are not only cold numbers, but also powerful proof of the prosperity and development of this huge ecosystem.

2. Quality supervision: 324 batches failed, hitting the pain point directly

The picture comes from the official website of the State Drug Administration

Data source: China Cosmetics

In 2025, the State Food and Drug Administration notified a total of 324 batches of cosmetics that did not meet regulations. The hardest hit areas were concentrated in facial masks, hair dyes, sunscreen, shampoo, hair care, and toothpaste. These unqualified cosmetics data clearly outline the current core pain points of the industry: microbial control is the basic bottom line, ingredient compliance is the core red line, and the addition of banned raw materials is an untouchable "high-voltage line." Through high-frequency, full-coverage spot inspections, regulatory authorities are forcing companies to transform from "emphasis on marketing and light on R&D" to "compliance and safety first". Any attempt to obtain short-term benefits through illegal means will face the risk of being severely punished by the market and law. At the end of 2025, the State Food and Drug Administration officially issued the "Three-Year Action Plan for Improving the Production Quality Management System of Cosmetic Enterprises" (2026-2028), which clearly stated that by 2028, the main responsibilities of enterprises should be comprehensively enhanced, illegal additions and unauthorized changes to formulas should be strictly cracked down, and the industry compliance threshold has been raised to the highest level in history.

五、 Product side: Special certificate reduction and efficacy involution

1. Registration volume of special cosmetics dropped
In 2024, there will be a total of 15,021 first-time registration applications for cosmetics that have been reviewed and approved by the State Food and Drug Administration. According to statistics from Beijing Zhengzhi Far East (OCI) Company, the number of special cosmetics registrations in 2025 will be approximately 11,000, a year-on-year decrease of 26.8%. Compared with the explosive growth in 2024, the number of special cosmetics registrations in 2025 does show a trend of falling back from a high level and making rational adjustments. This is not a signal of industry decline, but the inevitable pain of the industry's transformation from "barbaric growth" to "high-quality development" after regulatory policies deepen and compliance costs increase sharply:

• The implementation of the most stringent “full safety assessment report” in history, raising the entry threshold: Starting from May 1, 2025, the State Food and Drug Administration requires all special cosmetics registrations to submit a “full safety assessment report”, replacing the previous “simplified version”.
• Compliance costs have increased dramatically: The full version of the safety assessment report is no longer a simple data collection, but requires a series of measured data such as preservative challenge reports, product physical and chemical properties/stability test reports, and compatibility test reports of products and packaging materials.
• Lack of raw material data: According to industry estimates, at least 5,000 cosmetic raw materials lacked toxicological data at that time. If a company wants to register a new product, it must either spend high costs (the cost of additional toxicology testing for a single raw material will increase by at least RMB 50,000) for supplementary testing, or change raw materials, which will extend the R&D cycle by 6-12 months.
• Uncontrollable risks: Even if the company is willing to invest the cost, it is still unknown whether the final product can pass the strict review by experts from the Food and Drug Administration. This "high investment, high risk" situation has caused a large number of companies to take a wait-and-see attitude towards applying for new special certificates, and even voluntarily gave up the continued registration of some old special certificates.
• With the implementation of the guiding principles for the evaluation of anti-hair loss, whitening, sun protection and other efficacy, the technical difficulty and cost of applying for special certificates have increased significantly again, eliminating a large number of speculative companies.

2. Improve the efficacy evaluation system
2025 is the “big test year” for efficacy evaluation. Documents such as the "Technical Guidance Principles for Research on Anti-hair Loss Cosmetics (Trial)" were officially implemented, and in conjunction with the release of nearly 30 group standards related to efficacy evaluation, the industry has completely bid farewell to "conceptual claims" and entered the era of "data-based efficacy".

六、Conclusion
In 2025, China's cosmetics industry has proved the innovation potential of China's local supply chain with "465.3 billion retail sales" and "169 new raw materials", which is an important pole of global beauty innovation. Supervision will be normalized. In the first year of the implementation of the "Three-Year Action Plan", unannounced inspections will become more frequent, and quality control capabilities will become the life and death line of enterprises. With the launch of new whitening agents such as UP302, whitening products with special certification may usher in a wave of technological iterations in 2026. When "Chinese ingredients" are no longer a marketing label, but a "technical entity" based on solid toxicological and clinical data, the Chinese beauty industry has truly completed the transformation from "manufacturing" to "creation".

In this critical process of deep transformation and high-quality development of the industry, Beijing Oriental Intelligence (OCI) Company, as a third-party compliance service organization and industry infrastructure builder deeply involved in the field of beauty and cosmetics, has always taken scientific compliance as its foundation and protected the full-cycle development of enterprises with its professional capabilities.

In the future, OCI will continue to deepen the registration and filing of cosmetics and new raw materials, safety assessments, testing planning, compliance consulting and full-chain solutions. With more efficient services, more rigorous professionalism, and more forward-looking insights, OCI will accompany more Chinese brands through the regulatory cycle, avoid compliance risks, consolidate product confidence, gain a foothold in the trillion-level market, establish long-term, stable, and sustainable global competitiveness, and jointly build a new ecosystem for the high-quality development of Chinese beauty products.