MoCRA Small Business Exemption: Are You Under the Threshold?

Every small soap and skincare maker who's heard about MoCRA has asked some version of the same question: do I actually have to register with the FDA, or am I small enough to skip it? The honest answer takes a bit of arithmetic and a careful read of what "exempt" actually covers, because it's narrower than most people assume.

Start with the actual test

MoCRA, the Modernization of Cosmetics Regulation Act passed in 2022, requires facility registration and product listing with the FDA for most cosmetic manufacturers and processors. Some small businesses are exempt from these two specific requirements. The exemption is generally framed around average annual gross sales in cosmetic products over a trailing period, so the first step is pulling your actual sales figures, not guessing based on how the business feels.

Work through it like this:

1. Total your gross sales of cosmetic products, not total business revenue if you sell other things too
2. Average that figure over the relevant trailing period the exemption uses
3. Compare it against the current threshold, which you should confirm directly from FDA guidance since thresholds and their exact figures are the kind of detail that can be updated and is worth verifying at the source rather than relying on a number repeated secondhand
4. Check whether your specific product category falls under any carve-out that removes the exemption regardless of your sales figure

That last point is where people get tripped up.

The exemption has categorical carve-outs

Being under the sales threshold doesn't automatically mean you're exempt. Certain categories of products are excluded from the small business exemption regardless of company size, because Congress decided those product types carry enough risk that the registration and listing requirements should apply no matter how small the seller is. This typically includes products that come into contact with the eye area, products injected, products intended for internal use, and products that alter appearance for more than 24 hours under ordinary use conditions. If your product line touches any of those categories, don't assume small size gets you out of registration and listing. Confirm against current FDA guidance, since this is exactly the kind of detail worth checking directly rather than assuming.

What the exemption does not touch

This is the part that surprises people the most. Being exempt from facility registration and product listing does not mean you're exempt from MoCRA generally. Several obligations apply regardless of business size:

• Named responsible person. MoCRA requires a named responsible person for the product regardless of whether the business qualifies for the registration and listing exemption.
• Safety substantiation. The requirement to have adequate substantiation of a product's safety doesn't disappear because you're a small business.
• Adverse event recordkeeping. Recording and reporting serious adverse events is not size-gated the way registration and listing are.

So the exemption is real and it can save a small operation real administrative work, but it's a narrow exemption from two specific obligations, not a blanket pass from MoCRA as a whole.

A quick reference table

Obligation	Small business exemption applies?
Facility registration	Can be exempt if under sales threshold and no carve-out category applies
Product listing	Can be exempt if under sales threshold and no carve-out category applies
Named responsible person	Applies regardless of size
Safety substantiation	Applies regardless of size
Adverse event recordkeeping	Applies regardless of size

Why it's worth confirming rather than assuming

Thresholds, carve-out categories, and the exact trailing period used for the sales calculation are the kind of specifics that can shift, and getting them wrong in either direction costs you. Assume you're exempt when you're not, and you're operating an unregistered facility. Assume you need to register when you don't, and you've spent time on paperwork you didn't need. Either way, running your actual numbers against current FDA guidance beats going on what a forum post said last year.

If you're mapping out your US obligations alongside a Canadian launch, keep in mind these are entirely separate systems. Health Canada's CNF filing and MoCRA's registration and listing don't substitute for each other. Cosmetic Comply's Canadian filing flow is live today, with US support in development, so if you're building toward both markets it's worth tracking each country's requirements on its own timeline rather than assuming clearing one clears the other.