The cosmetics industry is a European success story. What makes the industry so competitive globally?
MEP Łukacijewska: The cosmetics and personal care industry is a flagship Europe success story. It contributes around €96bn annually to the EU economy, creating almost four million jobs. With more than 9,000 SMEs driving local growth, the sector is deeply embedded in regional communities. From Germany’s €15.9bn cosmetics market to France’s €20bn in total exports, and Spain’s expected 7.7% market growth in 2024, the sector highlights Europe’s industrial resilience. Poland’s growth (a 7.3% projected increase in 2024 alone) further illustrates how the sector reinforces the Single Market.
But cosmetics are not just about economic value. They are essential for hygiene, for our mental health and well-being, self-confidence, and everyday health. More than seven in ten Europeans acknowledge their positive impact. In the post-pandemic world, safe, trusted personal care products are even more important.
What sets Europe’s cosmetics industry apart globally is its incomparable commitment to safety. European cosmetics are the safest worldwide. Under the Cosmetics Products Regulation (CPR) — the world’s strictest cosmetics framework — every product must pass rigorous safety assessments. The sector consistently goes beyond compliance: the voluntary 2023 PFAS phase-out and the launch of the COSMILE Europe app demonstrates a proactive approach to consumer trust and product transparency.
Yet we policymakers must recognize the rising challenges facing the sector. Companies today navigate almost 300 sector-specific regulations. This ‘regulatory tsunami’ risks overwhelming SMEs, burdening innovation, and undermining Europe’s competitiveness.
As Mario Draghi rightly warned, Europe is at a crossroads. The cosmetics sector stands ready to lead the green and digital transition — if it is supported by smart, enabling regulation.
John Chave: I fully agree with this analysis. I would also add that in some cosmetic categories our products represent a certain cachet which many people around the world associate with Europe or the European way of life.
I also think that in cosmetics – as in other areas – Europe has hitherto set a benchmark for a responsible approach to regulation, balancing the number one priority of consumer safety with flexibility for the industry to innovate in the way MEP Łukacijewska describes. Other jurisdictions emulate our regulation, which I think is a positive factor in the EU’s influence around the world.
The concern is that if the EU over- regulates, for example in some of the ways Mr Draghi describes, this ‘Brussels effect ‘might be lost, which I think would be a big negative overall.
Large cosmetics manufacturers like L’Oreal, Unilver or LVMH are well-known. But some 9,000 SMEs in Europe are producing and exporting cosmetics. How can policy-makers better support them?
MEP Łukacijewska: Supporting SMEs requires directly addressing the growing regulatory complexity. Today, cosmetics SMEs face over 150 ingredients already under regulatory scrutiny or active restriction, alongside the ban of 200 substances classified as microplastics. Many of these restrictions are hazard-based, rather than rooted in real-world exposure or practical risk — leading to unnecessary bans, even on natural ingredients like green tea extracts that have long been safely used.
Visiting cosmetics production plants, I have seen the remarkable commitment to sustainability — many firms operate near zero-waste systems and boast water treatment and reuse facilities. What they need from us is a stable regulatory space to succeed. Policymakers should not turn a deaf ear to the voice of the industry. We must ensure that regulatory approaches remain evidence and science-based, risk-focused, and avoid unnecessary ingredient bans based only on chemical classification. Restrictions must be backed by robust safety data and impact assessment.
We also need realistic transitional periods, applicable only to products entering the market, allowing a natural phase-out of existing stock. Impractical transitions force unnecessary waste and penalize legally compliant businesses.
Market surveillance must be strengthened too. Imported, unsafe cosmetics, especially via online platforms, still constitute a significant amount of dangerous product alerts. European SMEs that follow the rules mustn’t be undercut by non-compliant imports. Finally, we must acknowledge the hidden costs of Green Deal compliance. ESG reporting requirements alone can reach up to €100,000 per company, placing a heavy burden on SMEs without necessarily delivering proportional sustainability benefits. A full assessment of these cumulative costs is a priority.
With a more business-oriented Parliament with different political majorities than before, Europe has the opportunity to rethink how it supports its SMEs: by encouraging innovation, keeping compliance costs manageable, and strengthening the Single Market in line with sustainability goals.
Europe has an opportunity to rethink how it supports its SMEs: by encouraging innovation, keeping compliance costs manageable, and strengthening the Single Market
John Chave: As you say, there are 9,000 SMEs producing cosmetics and personal care products in Europe, and very often these smaller companies make a vital contribution to their communities, and many exporting all over the world. There is no better example than MEP Łukacijewska’s own country, Poland, which is an SME powerhouse in our sector.
One factor I would stress is that SME’s can find it more challenging to adapt to burdensome regulation, particularly if these require reformulation, or changes to labelling, since they lack the economics of scale of bigger companies, or their research and development capacity.
I have heard in the past some stakeholders claim that SMEs are less affected by regulation because eg they only manufacture niche products, or only use certain types of ingredients. This is not correct – I echo MEP Łukacijewska’s point that disproportionate regulation can hit SMEs hard. If we are serious about safeguarding and building European competitiveness, we need to keep SMEs – in our sector and others – at the forefront of our considerations.
As policy-makers pursue ‘simplification’ across a range of sectors, the Commission has announced a fitness check on the Cosmetic Products Regulation. How can we ensure this is science-based, workable, and protects the sector?
MEP Łukacijewska: The upcoming CPR review will be a challenge. We must stay true to an evidence- and science-based, risk-driven approach. Moving toward hazard-only bans or applying the Essential Use Concept without considering real-world exposure could unnecessarily ban safe products — risking €40bn in reformulation costs and hitting SMEs the hardest.
The simplification must be meaningful, and must remove real technical barriers, making sure secondary rules align with the spirit of the CPR, REACH, and the Chemicals Strategy.
Then, workable transitional periods are essential. Businesses must have the space to adapt progressively. Forced withdrawal of already safe, legally placed products hinders competitiveness.
We cannot allow further fragmentation of the Single Market. National environmental labelling schemes like the one in France (Triman), or diverging rules under the Green Claims Directive, threaten to create a patchwork of 27 different systems. We need one strong, reasonable and business friendly European approach.
Finally, we now see that some laws, such as the Urban Wastewater Treatment Directive (UWWTD), were not exactly well thought through. While its goal of addressing micropollutants is crucial, the Directive impact assessment misallocated many micropollutants to the cosmetics sector. It appears that the Extended Producer Responsibility as defined is flawed and impossible to implement. The “polluter pays” principle needs to be fair based on real data — and ensure that all contributors share responsibility proportionately.
The cosmetics sector already leads in sustainability, safety, and innovation. As policymakers, our job is to protect that with rules that strengthen Europe’s economy and the Single Market, and empower our SMEs.
John Chave: I couldn’t agree more. One aspect I would comment on is that sometimes the simplification agenda is associated with ‘red tape’. For sure, we need to reduce unnecessary form filling and bureaucracy, but as MEP Łukacijewska points out, the real challenge is regulatory burden itself, which is more than red tape. For example, there is now a possibility that ethanol may be banned for use in cosmetics, even though it is perfectly safe in cosmetic uses, simply because of the way the current regulatory regime operates.
This needs more than simplification, it needs a re-think, one that of course prioritises safety, but does not lead to potentially huge negative effects on our manufacturers, SMEs and multinational alike.
I agree about UWWTD and take this opportunity to point out that following a freedom of information request we now have evidence that the Commission’s own impact assessment shows that our contribution to the toxic load in urban wastewater was overestimated by at least 15 times. When correctly assessed, cosmetics account for only 1.54% of the total toxic load not 26%.
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