Korea passes landmark law to supercharge $11.4 bil. cosmetics industry

Driven by unprecedented global demand for skincare and cosmetics, the National Assembly passed landmark legislation this week designed to systematically cultivate Korea’s beauty sector into a primary engine of national economic growth.

The Act on the Fostering and Support of the Cosmetics Industry establishes the nation’s first legal framework created specifically to nurture the commercial development of the sector. The measure operates independently of the long-standing Cosmetics Act, which historically focused on safety standards, manufacturing compliance and regulatory quality control rather than industrial expansion.

The legislative milestone follows a historic surge in international sales.

Korean cosmetics exports reached an all-time high of $11.4 billion in 2025, solidifying the country’s status alongside France as one of the world's top two beauty exporters. Cosmetics have also surged to become the single largest export category among domestic small and medium-sized enterprises, driving substantial employment and manufacturing output across the nation.

Yet despite its massive commercial expansion, the industry previously lacked targeted statutory backing. By enacting dedicated legislation, the Ministry of Health and Welfare gains formal legal authority to bolster the entire "K-beauty" ecosystem — ranging from brand developers and primary manufacturers to advanced packaging suppliers, raw material innovators and international distribution networks.

"K-beauty has grown into a globally competitive export industry through the relentless innovation and ambition of our domestic companies," said Minister of Health and Welfare Jeong Eun-kyeong. "With the enactment of this law, we will actively support the sector so it can take the leap toward becoming the world's undisputed market leader."

Under the newly created framework, the government will draft a comprehensive policy strategy for industrial advancement every five years. Major policy initiatives will undergo systematic review from a newly established public-private policy steering committee.

To accelerate international growth, the law introduces a formal certification for "innovative cosmetics companies." High-performing enterprises demonstrating substantial research and development investment alongside proven export capacity will receive priority access to government research grants, state-backed investment funds and specialized regional infrastructure programs, according to the ministry.

Furthermore, state support will expand into key modernization initiatives, including artificial intelligence integration for personalized product design, digital supply chain optimization, specialized workforce training and international regulatory compliance support. Small and medium-sized enterprises will receive prioritized access to these major programs to ensure sustainable, long-term development across the supply chain, according to the ministry.

The legislation is scheduled to take effect one year after its official promulgation, following final cabinet deliberation. In the interim, health officials said they plan to consult closely with industry leaders and technical experts to finalize subordinate regulations and draft the government's inaugural five-year strategic development plan.

This article was published with the assistance of generative AI and edited by The Korea Times.