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Retinyl palmitate is permitted by the US FDA. Several countries restrict, warning-label, or have reviewed it for safety concerns. The US has more lenient additive rules than the EU, UK, Canada, and Japan, which is why this ingredient remains widely used here.
The EU caps vitamin A levels over concerns it may accelerate skin damage in sunlight; the US does not restrict it.
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See the full Retinyl palmitate deep-dive page for regulatory citations, products that contain it, and verified clean swaps.