Is It Late to Secure Halal Certification in Indonesia?

Effective from October 2019, the government of Indonesia will enforce the mandatory halal certification and labeling measures for halal products in the country. Thus, InCorp Indonesia urges businesses and entrepreneurs to act appropriately and as soon as possible to avoid unnecessary penalties.

With over 260 million population, and 90% of them are Muslims, Indonesia remains the largest Muslim country in the world — making it among one of the biggest markets for Halal products and services. Along with the boom in non-food and beverage brands, introducing halal certification is a sure-fire strategy to win the hearts of the vast Muslim market in Indonesia.

The total value of halal imports to Indonesia amounts to US$163 billion, showing ample room for investors and manufacturers to penetrate the market.

However, Indonesia is enacting halal certification and labeling as mandatory for halal products under the Halal Law. Products subject to this law include goods and services related to food, beverages, pharmaceuticals, cosmetics, chemicals, biological products, and genetically modified products.

This law will be officially implemented in October 2019.

So, is it too late to secure halal certification in Indonesia now? Not precisely — as long as you keep reading this guide and know what to do to proceed with the application immediately.

What are Halal Products and Halal Certification?

“Halal” is an Arabic term that means “lawful or permissible.” It encompasses food and drink and everything in our daily life.

While the explanation of halal could be a little more complicated, the basic concept of halal is as such: food, drugs, cosmetics, and other products that do not contain any ingredients that are considered ‘haram.’

“Halal” must be traced back to the source of Muslim food or touch, from raw materials to product handling, including factory facilities, manufacturing machinery, packaging, storage, logistics, and even retail stores.

Haram is the opposite of halal, meaning “forbidden or proscribed” by Islamic law. Everything that contains pork, animal blood, alcohol, dead animals, and poisonous animals is deemed haram. Other than that, slaughtering animals without following Islamic Law is considered haram as well.

A halal certificate is a document to justify that halal products sold to and used by the Muslim population comply with Islamic Sharia laws. For businesses, halal certification is the only way to label their products as halal.

Related article: Most Common Questions about Halal Certificate

Halal Certification Issuing Body in Indonesia

As mentioned above, the National Body of Halal Assurance (BPJPH) will be the highest authority to issue halal certificates to businesses starting in October 2019. Besides, MUI, one of the highest authorities on Islamic affairs in Indonesia, will be in charge of issuing the Halal fatwa and setting up the halal compliance standard.

Two major authorities are under MUI — The Food, Drug and Cosmetics Assessment Agency (LPPOM) and the MUI Fatwa Committee. They are in charge of the halal audit, assessment, and declaration.

Halal Process Verification

Although BPJPH is responsible for halal certificate issuance, the process of verifying if a product is halal will be done by the Halal Inspection Institution or Lembaga Pemeriksa Halal (LPH) in Indonesian. LPH will inspect and check if the production process, raw materials, and storage are halal inside and outside the manufacturing facilities.

The government usually sets up LPH but may be established by public institutions such as universities.

To perform the verification operation, LPH must first be accredited by BPJPH. Then, the approved LPH needs to employ a minimum of 3 inspectors equipped with its laboratory. If the LPH does not have its laboratory, it can cooperate with another party with a laboratory.

Halal Certification Process in Indonesia

With the enactment of the new halal law, businesses need to know that all non-registered halal products will be deemed as non-halal this year (2019).

Noticeably, to certify your halal products in Indonesia makes a lot of sense. Halal labeling on products seems to be a lot more appealing to Muslims who try to avoid any possibility of consuming or getting into touch with haram products.

While the process of halal certification in Indonesia might seem tedious and burdensome due to the paperwork to comply with the requirements, the procedure could be a simple one with InCorp Indonesia’s registration assistance:

1. Fulfilling MS23000 halal requirements related to raw materials, products, and manufacturing process, and then with the implementation of Halal Assurance System (HAS).
2. You were getting ready with all the documents required for the application of halal certification. You must submit the documents to us, along with the halal certification contract fee and registration fee. We will organize the documents for you to comply with the submission requirements.
3. Fill out documents as required by the LLPOM-MUI during the registration process, according to your certification status. You also need to submit the dossier to us for LLPOM-MUI to process.
4. InCorp Indonesia will guide pre-audit, audit, post-audit assessments, and lab analysis to ensure conformity.
5. Products fulfill HAS requirements and LLPOM-MUI lab analysis.
6. MUI approves the products or materials, and BPJPH issues the halal certificate

The entire process will take approximately 60 days. The validity of halal certificates under BPJPH is four years. The validity may not apply if a product’s composition has been modified. According to Indonesian Law No. 6 Year 2023, halal certification is valid as long as there’s no change in the ingredient or process.

Even though it might not be too late to secure your halal registration in Indonesia, be aware that thousands of products have not been certified yet. Taking in mind that BPJPH estimated it could issue about 7,000 halal certificates every year, long delays are expected, and failing to meet the deadline of October 2019 might not only result in sanctions but a drop in your sales.

Severe Sanctions for Non-Compliance

Criminal sanctions are introduced under the new Halal Law and may be imposed on businesses with halal products as well as the LPH. Companies with halal certificates that fail to maintain their products’ halal quality will face up to IDR 2 billion in fines or 5 years of imprisonment.

Besides, LPH that fails to protect trade secrets, such as the halal product formula that they evaluate, will be subject to IDR 2 billion fines as well, or up to 2 years of imprisonment. This is the first time that criminal sanctions will be imposed on halal non-compliance.

Is Foreign Halal Certification Accepted in Indonesia?

According to Indonesian halal law, products or materials with halal certification from outside Indonesia must be registered at BPJPH. Only then can they be distributed and sold in Indonesia with legal halal status.

However, halal certificates issued by foreign certification institutions that are not listed in the regulation will have to go through BPJPH assessments.

How We Can Help

Receiving a halal certification for your product is very important if you plan to distribute in Indonesia. InCorp Indonesia can help ease the process and keep you on track with your application and many other product certifications and registrations.