Exclusive: Perfume-makers fear EU legal blow to industry

Perfume-makers are urging the European Commission to back down from possible legislation they fear could kill top fragrances by restricting natural ingredients linked to allergies, industry sources say.

Luxury brands fear the EU could force them to change formulas across the $24.3 billion premium fragrance industry, altering some of the world's most iconic scents, such as Chanel No. 5, created in 1921.

Hundreds of perfumes, including Miss Dior and many Guerlain scents, would have to be reformulated if the EU executive turns into law the recommendations issued in July by the advisory Scientific Committee on Consumer Safety (SCCS).

Companies say the scents of leading brands would never smell the same, and perfume-creators would be left in future with a much smaller palette of ingredients.

"It would be the end of beautiful perfumes if we could not use these ingredients," Francoise Montenay, non-executive chairwoman of Chanel, told Reuters in a telephone interview.

The committee estimates 1-3 percent of people in Europe are allergic or potentially allergic to ingredients found in perfumes - a number it considers high enough to justify concern.

"All citizens are entitled to the same protection," SCCS Working Group chairman Ian White, from London's St John's Institute of Dermatology, told Reuters.

It recommended restricting the concentration of 12 substances - including citral, found in lemon and tangerine oils; coumarin, found in tropical tonka beans; and eugenol, found in rose oil - to 0.01 percent of the finished product.

And it proposed an outright ban on tree moss and oak moss, which provides distinctive woody base notes in Chanel's No.5 and Dior's Miss Dior.

"(These ingredients are) the spine of about 90 percent of fine fragrances," said Pierre Sivac, Chairman of the International Fragrance Association (IFRA), whose members include America's International Flavors & Fragrances and Switzerland's Givaudan .

The EU Commission's health and consumer Directorate General told Reuters it was in talks with all concerned parties, including perfume-makers, to assess the SCCS's recommendations and potential impact on the industry.

"In light of the SCCS opinion, the Commission is currently reflecting on the regulatory measures to implement the scientific opinion into the cosmetics legislation and ensure appropriate protection of consumers," the Commission said.

CULTURAL HERITAGE AT STAKE

The impact would be felt by big luxury groups such as LVMH , which owns Dior and Guerlain, right down to hundreds of small plant growers around the world.

"It is essential to preserve Europe's olfactory cultural heritage," LVMH said in an e-mailed statement, stressing nonetheless the well-being of consumers was a "major concern".

Any new laws curtailing the use of natural scents would also impact fragrance-producers such as Givaudan and Firmenich as well as Germany's Symrise , Japan's Takasago and Robertet in France's scents-producing town of Grasse.

Industry sources say they expected regulatory proposals by January 2014. However the Commission declined to comment on a timeframe for possible legislation.

Trade associations including IFRA and Cosmetics Europe, whose members are perfume and cosmetics companies such as LVMH, are aiming to submit a joint industry proposal to the Commission by the end of 2012, the same industry sources said.

(Reporting by Astrid Wendlandt; Editing by Mark John and Peter Graff)