AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
Shea butter sold in the US to moisturise skin or hair is a cosmetic, so it falls under the Modernization of Cosmetics Regulation Act (MoCRA): the facility that makes or processes it registers with the FDA and renews every two years, the company named on the label lists each product and its ingredients and updates the listing every year, and serious adverse events must be reported within 15 business days. Medical claims, such as treating eczema, turn it into a drug.
Is shea butter a cosmetic, a drug or neither?
US law decides by intended use, not by what is in the jar. The FDA explains that a cosmetic is a product intended for cleansing, beautifying, promoting attractiveness or altering appearance, and gives moisturisers as an example. A drug is a product intended to diagnose, cure, mitigate, treat or prevent disease, or to affect the structure or function of the body. Intended use is shown by your claims on labels, websites and social media, by why customers buy it, and sometimes by ingredients.
| How you sell the shea butter | Likely status |
|---|---|
| "Raw unrefined shea butter for soft skin and hair" | cosmetic |
| "Heals eczema, clears stretch marks, treats psoriasis" | drug, which brings FDA drug rules |
| Moisturiser with an SPF claim | both cosmetic and drug, with Drug Facts labelling |
| Bulk shea sold to a US manufacturer as an ingredient | raw material; the manufacturer's finished product is the cosmetic |
The FDA gives the example that claims to restore hair growth, reduce cellulite or regenerate cells make a product a drug even if it is sold as a cosmetic. Shea sellers often repeat health claims from Nigerian markets online. Each one of those claims changes the regulatory status of your product. Keep claims to what a moisturiser does.
What MoCRA requires
MoCRA, the 2022 law, gave the FDA its first registration and listing system for cosmetics. The FDA's pages (updated 9 September 2026 and 10 August 2026) set out these duties:
- Facility registration
- Manufacturers and processors register their facilities with the FDA and renew every two years from the initial registration date. An abbreviated renewal is available if nothing has changed.
- Product listing
- The responsible person (the manufacturer, packer or distributor named on the label) lists each marketed product with its ingredients and updates the listing each year.
- Adverse events
- The responsible person must report serious adverse events to the FDA within 15 business days, with a copy of the label, and report new information received within a year within 15 business days.
- Safety substantiation
- The responsible person keeps records supporting the product's safety; existing scientific data may be used.
- FDA powers
- Access to certain records, mandatory recall where a firm refuses a voluntary one, and suspension of a facility registration.
Registration is not approval. The FDA says it does not issue certificates of compliance, and a registration number does not signal that it approves anything. Be wary of any agent who sells an "FDA certificate" for shea butter.
How to register and list
The FDA's tool is Cosmetics Direct, which builds and submits the structured product labelling (SPL) files for registration and listing. Firms with their own software can submit through the FDA's ESG NextGen gateway, which needs a free account that the FDA says can take one to three weeks to set up. Paper Forms FDA 5066 (facility) and 5067 (listing) exist, but the FDA strongly encourages electronic filing. The FDA's Facility Establishment Identifier (FEI) number serves as the facility registration number.
Small business exemption
MoCRA exempts certain small businesses from registration, listing and good manufacturing practice rules. The FDA pages we read describe the exemption but do not state the sales threshold, so check the current figure with the FDA or an adviser before relying on it. The exemption does not cover products that contact the eye's mucous membranes, injected products, products for internal use, or products meant to alter appearance for more than 24 hours. Adverse event reporting and safety records are not on that exempt list on the FDA page.
Practical issues for Nigerian shea
- Who is the Nigerian processor? If a Nigerian cooperative makes the butter you sell as a finished cosmetic, its facility is the one to register; many small producers will need your help to do it.
- Who is the responsible person? Usually the company whose name is on the label, often your US company.
- Colours and additives: the FDA lists alert 53-06, on cosmetics with colour additive violations, among those that apply to Nigeria. Coloured or scented shea blends need their additives checked.
- Medicated creams: alert 66-41, on unapproved new drugs promoted in the US, also applies to Nigeria. Shea products sold with treatment claims are exactly the kind of product it targets.
Import alerts are explained in what FDA import alerts mean. If you also sell black soap, read black soap labelling, because true soap follows different rules.
Steps before your first shipment
- Write your claims first and keep them cosmetic.
- Decide who the responsible person on the label will be.
- Confirm whether the small business exemption applies, using a current FDA source.
- If not exempt, register the manufacturing or processing facility and list the product in Cosmetics Direct.
- Set up a way to receive and log adverse event reports, and keep safety records.
- Ask the supplier for a specification and, for blends, a full ingredient list.
Where Pryme fits
Shea is often bought from cooperatives that want naira, quickly. A Pryme Business Account opened from the US holds USD and NGN with local details for each, and you can pay the cooperative in naira after a Swap that shows the rate and the fee before you approve. Invoicing helps you bill US salons and stores, and see business multicurrency accounts.
Questions people ask
Do I need FDA approval to sell shea butter in the US?
No. Cosmetics do not need FDA approval, but under MoCRA the facility may need to register and the product may need to be listed. Drug claims change that.
Is raw shea butter exempt from MoCRA?
Not because it is raw. What matters is how it is sold. As a skin or hair moisturiser it is a cosmetic; some small businesses are exempt from registration and listing.
How often must a cosmetic facility renew FDA registration?
Every two years from the initial registration date, according to the FDA. Product listings are updated annually.
Can I say my shea butter treats eczema?
That is a drug claim. The FDA says treatment claims make a product a drug, which brings drug rules and labelling.
Sources
- FDA: Registration and listing of cosmetic product facilities and products (updated 9 Sep 2026) · accessed Oct 2026
- FDA: Modernization of Cosmetics Regulation Act of 2022 (MoCRA) (content current as of 10 Aug 2026) · accessed Oct 2026
- FDA: Is it a cosmetic, a drug, or both? (Or is it soap?) (11 Sep 2024) · accessed Oct 2026
- FDA: Import alerts by country, Nigeria (posted 21 Oct 2026) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.