This issue goes around like an email virus from time to time. First, the penny and/or gold ring test is not reliable. However, as the Safe Cosmetics campaign notes, this is one urban legend that turns out be true, in some cases. Whether lipstick in Canada contains lead likely depends on how well we enforce the law. 

In Canada, lead (and about 500 other ingredients) in cosmetics are regulated. Canada publishes a "hot list" of such ingredients. Most chemicals on the list are prohibited, some are restricted, for use in cosmetics. The hot list notes that lead and its compounds as well as lead acetate are prohibited in cosmetics in Canada. The United States has not created as extensive a list of restrictions though they are being considered. In the meantime, very few ingredients in cosmetics are regulated in the US. Continued interest in the issue of lead in lipstick comes in part from the fact that a US Food and Drug Administration study has been prepared but has yet to be released despite repeated requests and pressures from various groups and the public.

If people are still concerned about their lipstick (and lead is not the only potentially toxic ingredient that could be present in lipstick), they can reduce their use of lipstick and also look into products containing safer chemicals for their next purchase. The Environmental Working Group’s cosmetic database Skin Deep has over 1500 lipstick products listed that are evaluated for their chemical content and they provide many suggestions for safer products. It also rates other cosmetic products. For a Canadian site providing information about less toxic alternatives in cosmetics see the Less Toxic Guide.