Marcha Chaudry, Equity Wellness Co. and Rachel Raphael, Morgan Lewis

Much attention during the past few years has been paid to the Modernization of Cosmetics Regulation Act (MoCRA), which marked the most significant update to US cosmetic law in more than 80 years. But MoCRA is only one part of a much larger and rapidly shifting compliance landscape. Beauty brands in the US must navigate an intricate web of overlapping requirements that go far beyond federal law.

Various states have enacted their own chemical safety, disclosure and labeling rules that operate independently of MoCRA. For example, California’s Proposition 65 requires warnings for products containing listed chemicals, New York mandates public ingredient disclosures and Washington’s Toxic-Free Cosmetics Act includes outright bans on entire chemical classes. At the same time, retailers adopted their own rules of the road. Programs, such Conscious Beauty at Ulta, require brands to produce proof of compliance with restricted substance lists, safety testing and substantiated marketing claims before their products even reach the shelves. Many retailers also require brands to submit data through digital documentation platforms such as WERCS, with its own formatting, ingredient thresholds and transparency expectations.

For brands seeking to scale their businesses globally, the complexity deepens. Markets such as the European Union, United Kingdom and Canada impose premarket safety assessments, labeling standards and “Responsible Person” requirements that far exceed US federal regulations.

In an environment contending with all of these differing metrics, compliance can feel like a moving target. Yet the goal should be preparedness rather than perfection. Understanding obligations at all levels better positions personal care and cosmetics companies to anticipate risk rather than simply react to it.

Building the Compliance Foundation

A solid foundation is built on clear ownership. Under MoCRA and most global frameworks, the Responsible Person named on a product label is legally accountable for product safety, labeling accuracy and timely registration.

Personal care and cosmetics companies, and their contracting partners, must make clear, in writing, who is in control of formulation and ingredient data, testing, documentation and product listing information. Brands should never simply assume that their third-party contract manufacturer has it handled. Ultimately it is the name of the brand on the product label that is left “holding the bag” if something goes awry.

Accordingly, personal care and cosmetics company should maintain the following on all of their products:

• Comprehensive formulation data: Maintain records of the full INCI breakdown as well as each ingredient function and concentration and an understanding of how this compares to the evolving list of chemical ingredients that are (or may become) limited or banned in all jurisdictions in which product is sold.

• Safety and stability testing: It is important to have documentation of who is performing all human repeat insult patch tests, preservative efficacy tests and stability testing, and have copies of all test results.

• Accurate product listing information: Ensure that all regulatory submissions match current formulations and packaging. Product packaging must accurately reflect the product formulation.

• Good Manufacturing Practice (GMP) documentation: Keep records of all supplier audits and virtual inspections, retain product samples and maintain written batch specifications.

• Comprehensive compliance files: Documentation discipline is crucial, and every stock keeping unit should have a file containing all Certificates of Analysis, Safety Data Sheets, testing reports, ingredient disclosures and supplier attestations on a controlled, digital system that is accessible to all necessary personnel.

Monitor Your Products

In addition to the key items above, brands must monitor their products once they are on the market—tracking customer complaints and investigating those complaints were appropriate. Not only are brands required under MoCRA to maintain records of adverse events, but Responsible Persons must report serious adverse events to US Food and Drug Administration.

Compliance with US federal regulations is just one layer for companies selling their products in the US. State laws add independent obligations, from California’s Prop 65 warnings to New York’s disclosure mandates and Washington’s chemical bans. Together they make up a multitiered compliance system in which record-keeping must satisfy both federal and state requirements as well as retailer and global transparency standards.

To keep pace, brands of all stages and sizes must adopt record management frameworks that track ingredients for safety, disclosure thresholds and all other applicable restrictions whether imposed by a retailer that carries products on its shelves or a country outside the US where the product is sold.

Preparing for Litigation

The best prepared companies do not look at regulatory compliance in a vacuum, but rather with litigation in mind. Enforcement can come in various forms, from state agencies to private consumer plaintiffs.

At the federal level, for example, the US Federal Trade Commission continues to target potentially misleading or deceptive advertising and marketing claims. Terms such as “clinically proven,” “dermatologist tested” and “non-toxic” require substantiation. In other words, if you do not have the evidence to support the claim, do not make it.

At the state level, enforcement is growing but remains concentrated in a few jurisdictions. California continues to pursue Prop 65 actions related to chemical exposure warnings in cosmetics and personal care products. Other states, such as Washington, are laying the groundwork for future enforcement through new chemical safety laws like the Toxic-Free Cosmetics Act, which went to effect on January 1, 2025.

Private consumer plaintiffs continue to drive lawsuits against personal care and cosmetics companies marketing their products as “safe,” “natural,” “clean” and “sustainable” for failing to disclose the presence of allegedly harmful (and largely ubiquitous) chemicals such as PFAS and for deceptive influencer marketing.

Being aware of potential litigation risk is the only way to mitigate it. As such, it is critical for companies to keep litigation in mind when navigating the patchwork of applicable rules and regulations.

Social media influencers, marketing agencies, retailers, distributors and any other third parties in the supply, distribution and marketing chain can add layers of potential exposure. Contracts may attempt to shift liability in the direction of the brand, meaning the brand could be responsible for the failure of a third party. Careful, proactive review of all contracts at the outset and ongoing oversight of all partners in the supply, distribution and marketing chain is essential to limiting risk.

Personal Care and Cosmetics Brand Checklist

Here’s a checklist that brands and their partners can use to understand legal risks.

1. Build compliance into your business plan from day one. A company’s regulatory compliance framework needs to evolve alongside marketing and product development (and beyond), not just after product launch.

2. Prioritize proper documentation and insist on transparency by third parties. Organized records are critical from the outset, as are transparent relationships with third parties dictated by contracts that set clear expectations for everyone involved.

3. Monitor and analyze consumer complaints. Mandatory adverse event records may reveal trends and quick action may prevent larger issues. Stay on top of your data so that you can more easily and efficiently adapt if a change is needed.

4. Insist on employee training and communication across teams. Regulatory, R&D, Customer Service, Marketing and Sales all influence compliance outcomes. Every employee should be able to recognize an adverse event report. Those tasked with reviewing and investigating consumer claims should be trained to do so. Likewise, communication and collaboration among teams is critical to continued compliance and ultimately brand success.

5. Revisit contracts annually. Build in routine review of all third-party contracts to ensure they align with your understanding of the brand’s legal risk.

Conclusion

True compliance readiness means balancing regulatory vigilance with litigation risk mitigation. For US personal care and cosmetics companies, federal law is only the beginning. State statutes, global rules and regulations, and even retailer requirements, come together to set the floor for compliance in the beauty industry today.

The brands that thrive will be those that keep litigation in mind when navigating regulatory requirements and view compliance as part of their business DNA—an ongoing investment in transparency, documentation and accountability. Partnering with trusted legal counsel early in the litigation risk management and regulatory compliance process helps to prevent costly missteps and better positions the company to face challenges if and when they arise.

About the Authors

Marcha Chaudry, Esq. Founder & Regulatory Counsel, Equity Wellness Co
Marcha Chaudry is an attorney and the founder of Equity Wellness Co (EWC), a boutique consultancy specializing in legal and regulatory strategy for beauty, wellness, and consumer health brands. She advises companies on FDA and FTC compliance, US state and federal regulations, and international market entry, helping brands strengthen credibility and ensure market readiness under evolving regulations.

Rachel Raphael, Esq., Partner, Morgan Lewis
Raphael is a litigator and risk management counselor who represents clients in a variety of industries, including consumer products, personal care, and cosmetics. Rachel defends companies in complex product liability and consumer class action litigation throughout the United States. She also advises clients on issues arising throughout the product lifecycle, whether they are exploring new ventures, analyzing product risks, dealing with customer complaints, navigating product recalls, or evaluating product marketing and advertising claims.