Trade Secrets

Although it’s one word on an ingredient label, “fragrance” can contain dozens, even hundreds, of chemicals. Fragrance manufacturers claim that the specific chemicals used to create their scents are confidential business information, or “trade secrets,” a concept originally codified in the 1966 Federal Fair Packaging and Labeling Act (FPLA). The FPLA prevents the Food and Drug Administration (FDA) from compelling manufacturers to disclose the chemical compositions of their fragrances, and instead permits manufacturers to omit labeling their products with the specific chemicals used in their formulation.[1] Trade secret protections are further codified in the 1979 Uniform Trade Secrets Act (UTSA), a legal framework that states can voluntarily adopt to clarify the definition of trade secrets and strengthened the awarded protections to businesses; 47 states, Washington D.C., the U.S. Virgin Islands and Puerto Rico have made this framework state or local law.[2] Together, these laws solely require manufacturers to label products with fragrance-concoctions as “fragrance,” “parfum,” or “aroma.”

Fragrance houses base their claim for trade secret protection on the assertion that labeling their products with chemical lists would give away proprietary information known solely to the company. However, UTSA specifically qualifies that trade secrets are, “information … not being generally known to or readily ascertainable through appropriate means by other persons who might obtain economic value from its disclosure or use.”[3] Listing the chemicals on the labels of cosmetics would not reveal information that could not alternatively be derived by “appropriate means by other people,” namely through the process of reverse-engineering, which has become standard practice in the fragrance industry. In other words, the chemicals in fragrance simply no longer qualify as “trade secrets” under the legal definition provided by UTSA. Further, federal and state laws already require the disclosure of ingredients for over-the-counter drugs and cosmetics, among other things and this requirement has not adversely affected these industries.[4] Some cleaning product companies already voluntarily label all, or almost all, of the chemicals that comprise their fragrances, like Seventh Generation[5] and SC Johnson[6] and hundreds of cosmetic companies are also fully disclosing fragrance ingredients.[7]

Despite holes in the trade secret argument, the personal care product and cosmetic industry continues to use this logic to avoid full fragrance disclosure. Without full disclosure of pertinent chemical information, consumers cannot make informed decisions about products they are exposed to daily. In addition, researchers, healthcare providers and regulators cannot understand the full universe of ingredients used to formulate cosmetic products, limiting the breadth of research on chemical safety and subsequent health care and legal policies constructed to protect the general population. The fragrance industry has been trusted to “self-regulate” and test its chemicals for safety through its Research Institute for Fragrance Materials (RIFM), but RIFM’s un-generalized findings and methods of analysis are kept secret, preventing a deeper analysis and verification of their findings by those outside the fragrance industry. The UN Global Harmonized System of Classification and Labelling of Chemicals (UNGHS) has identified 1,000+ chemicals currently used in fragrance that either qualify for a “danger” or “warning” level classification, and yet only 186 chemicals have been banned for use by the Environmental Protection Agency (EPA) to date.[8]

[1] http://www.fda.gov/RegulatoryInformation/Legislation/ucm148722.htm

[2] http://www.uniformlaws.org/LegislativeFactSheet.aspx?title=Trade%20Secrets%20Act

[3] https://www.law.cornell.edu/wex/trade_secret

[4] http://www.seventhgeneration.com/come-clean/frequently-asked-questions-about-ingredient-disclosure

[5] http://www.seventhgeneration.com/ingredients-glossary

[6] http://www.scjohnson.com/en/products/monty/fragrancedisclosure.aspx

[7] Market Shift: The story of the Compact for Safe Cosmetics and the growing demand for safer products, November 2011 by the Breast Cancer Fund and Commonweal, p. 14-15.

[8] http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&sid=c108128827d21f2d274e894731665ef4&rgn=div6&view=text&node=21:7.0.1.2.10.2&idno=21