Beauty and a beastly fine over cosmetics
Arena Holdings PTY
Business | What A Week
A small trading company in southwest China was fined $420m (R8.17bn) for violating rules on cosmetics sales, one of the harshest penalties in a nationwide crackdown on unlawful sales of cosmetic products. Chongqing-based Dezhao was fined by the regulator for suspected flouting of cosmetics regulation management rules, including failure to get permits for the import of some cosmetics products, according to a government statement dated April 26. The fine was 2,900 times the company’s registered capital, according to Chinese data provider Tianyancha. Since late 2021, China has launched a crackdown on online and offline sales of illegal cosmetics, inspecting medical claims made by cosmetic products and cleaning up sales of unregistered cosmetics. China also unleashed a campaign to regulate advertisements for cosmetic surgery deemed excessive or making false claims. In September, companies are also due to change the packaging of cosmetics to adhere to more stringent requirements on design and presentation. China meted out a record fine of 55bn yuan (R152bn) last year to Tomorrow Holdings, a financial conglomerate previously controlled by tycoon Xiao Jianhua.