What the new Brazilian biodiversity regulation means to cosmetics companies

By Simon Pitman contact

- Last updated on GMT

What the new Brazilian biodiversity regulation means to cosmetics companies

Related tags: Brazilian biodiversity, Law

With a new Brazilian regulation aiming to generate more research and cultivation of indigenous plant species, cosmetics companies look set to benefit but will also be expected to foot the bill.

Cosmetics Design spoke to Anita Pissolito Campos, who is a partner at the Sao Paulo-based Nascimento e Mourão law practice, whose responsibilities cover intellectual property in biodiversity and environmental law. 

Pissolito is set to give a presentation about the new regulation and its implications at the forthcoming Sustainable Cosmetics Summit, taking place in Sao Paulo next month.

In this interview Pissolito explains in  detail about how the regulation should generate greater interest in Brazilian biodiversity and the wealth of potential new ingredients on offer for the cosmetics industry. But while suppliers will have greater scope, finished goods manufacturers look set to pay for the initiative. 

What is the primary goal of the new Brazilian biodiversity regulations?

“It seems that Law 13.123 intends to create a secure regulatory environment to stimulate the use of Brazilian biodiversity, since it eliminates the obligation of obtaining an authorization prior to the access to the Brazilian Biodiversity,”​ Pissolito stated.

“However the new law changes the rules related to benefit sharing, and foresees that 1% of net revenues from the final product will be used as a mandatory benefit sharing, if that final product contains ingredients/raw material derived from access to Brazilian biodiversity.”

Pissolito then went on to state that many cosmetics manufacturers may deem that 1% of the net revenues from such products is a high economic impact, although the intention of the law is to help expand the cultivation and use of Brazilian biodiversity.

What was in place before this regulation was introduced?

“Prior to Law 13.123, we had Provisional Act 2.186-16/2001 - which still is in force - and in order to perform access to Brazilian biodiversity or its remittance abroad, before the start of the research and development the user should obtain prior informed consent of the provider, execute a benefit-sharing agreement, file an authorization request with the Government and await the issuance of an authorization. 

 "The beneficiary of this agreement was the provider of the species to be accessed and with the new Law it is the Union and the agreement shall be executed with the Union. This bureaucracy subjected companies that used Brazilian biodiversity to fines and other penalties and did not promote the use of Brazilan biodiversity or the benefit sharing.”

What do these regulations mean to natural and organic cosmetics companies?

  “Law 13.123 means that natural and organic cosmetics have the opportunity to use Brazilian biodiversity without the risks of receiving a fine or any other penalty, since access to Brazilian Biodiversity shall be carried out after a registration of the research and without the need of obtaining an authorization prior to the access​.

“Also, companies that produces intermediary products - the products that are used as ingredients or raw material in the preparation of a final product - shall not share benefits and just need to register the access to Brazilian biodiversity that intend to do or the remittance of samples abroad, on the system that Government shall provide.”

 How can a cosmetics company know it is doing business and staying within the new law?​                                                                                  

“In case the cosmetic company is researching Brazilian Biodiversity or is developing a new material or a new product using Brazilian biodiversity or the result of its metabolism to such development, the company is doing business and is staying within the law. 

“However, only the manufacturer of the final product shall pay benefits, the producers of intermediary products shall only register its researches and development. Also, the company shall analyse each research or development procedure in order to check if there is access and when the development started, in order to conclude if the specific product development is under the new law.”

How is it likely to affect natural and organic cosmetics doing business in Brazil?​ 

“The Decree that shall clarify some aspects of the new law is being prepared by Government and will be presented on a Public Consult basis prior to its publication, so companies will be able to pose their views and suggestions. That is really important, especially to define the scope of the new Law, which is not very clear yet.​ 

“However, as per the text of article 1 of the Law it is possible to understand that the new Law will not be applied to a broader diversity of natural ingredients, since it should only be applied to native species and domesticated species that naturally developed distinctive characteristics in Brazilian territory. This means it would not include all domesticated or cultivated species. But since there are other possible interpretation of the concepts presented on the new Law, it is important to pose the company’s interpretation of the law during Public Consult on that subject.”

What kind of positive effects is the law likely to have on Brazilian biodiversity?

“The law simplifies the regulatory procedure prior to the access, therefore stimulates the research of Brazilian biodiversity. Also, it creates an environment with more security to the users of that system, since it is possible to know which obligations you should fulfil, and also it is possible to calculate the costs that the use of an ingredient derived of access to Brazilian biodiversity may mean for the final product.”

Pissolito also pointed out that the Law exempts payment of benefit sharing in a number of cases, including if you are a micro organization or small enterprise, you are an intermediary company, or if you are looking to license a technology patent without specific reference to a finished product.

 

Dr. Anita Pissolito will give her presentation on Brazilian biodiversity regulations on September 28th​ at the Sao Paulo Sustainable Cosmetics Summit​.

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