Indonesia’s Halal Law Comes into Effect

November 2019

Indonesia’s Halal Product Law came into effect as of 17 October 2019. The Halal Law regulates the processing, materials and certification of Halal products, on top of establishing partnerships with international Halal agencies. It is hoped that the Halal certificates can generate added value for business and improve Indonesia’s competitiveness on Islamic economy.

A new government agency, the Halal Products Certification Agency (BPJPH), will issue the Halal certificates through a one-stop-shop system. The Halal Law will initially be applied to food and beverages, including those produced by small- and medium-sized enterprises and street vendors. Cosmetics, drugs, and other consumer goods and services related to these goods are to follow suit by 2022. Those who violate the Halal Law will be reprimanded at the beginning of 2024. The exact amount of penalty is not finalized yet.

Businesses that need to obtain Halal certification are required to follow the following steps:

  • Businesses must register their company and products at the Ministry of Religious Affairs in Jakarta (BPJPH is not ready yet to receive applications). For medium and large-sized enterprises, the registration fees will range between 100 thousand Rupiah (USD 7) and 500 thousand Rupiah (USD 35);
  • Once registration is obtained, BPJPH will issue a special registration number. Businesses must place the number on all packaging or product itself;
  • Applicant choose a state-owned and private Halal inspection agencies (LPH) agency from BPJPH list. The LPH agency will investigate and conduct relevant tests on the products or services. Testing and examination fees will range between 3.5 million Rupiah (USD 248) and 4 million Rupiah (USD 284), depending on the complexity of the raw materials tested;
  • Results will then be forwarded to Food and Drug Research Institute of the Indonesian Ulema Council (MUI) who will give the final verdict;
  • Upon MUI’s approval, BPJPH will issue the Halal certificate. The certificate issuance will cost 150 thousand Rupiah (USD 10) and 1.5 million Rupiah (USD 106) for medium-sized companies and 1.5 million Rupiah (USD 106) and 5 million Rupiah (USD 355) for large enterprises.

For foreign companies, they must obtain Halal certification from an agency from their own country that has already been registered with BPJPH. The full list of international partners is on pending. Once the list is out, the companies can follow the steps below:

  • Foreign businesses can register with BPJPH with a list and detailed description of products, with the addition of Halal certification from local Foreign Halal Agencies (FHA) partner;
  • BPJPH will issue a special registration number. Businesses must place the number on all packaging or product itself;
  • Product is ready for export to Indonesia.

Besides Halal Law coming into effect, Indonesia has also launched the capital city’s first halal park at Gelora Bung Karno located in Central Jakarta area. The park, expected to be fully operational by 2020, will target the Halal lifestyle of Indonesians as well as foreign visitors and will be lined with shops offering Muslim fashion and halal food.

(Sources: Channel News Asia; ASEAN Briefing)

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