Draft Law On Halal Product Guarantee Implements Mandatory Halal Labeling

The House of Representatives passed the Draft Law on Halal Product Guarantee(“Halal Draft Law”) to provide legal certainty toward the Halal condition of a product, which is proven by a Halal Certificate. The Halal Draft Law is relevant to broad business activities, since it involves Halal Product Process that is a series of activities to ensure a product is Halal covering its materials supply, processing, storage, packaging, distribution, sales, and product presentment.

Products that enters, circulates, and be traded in the Indonesia’s territory must be Halal Certified. The definition of Products are goods and/or services which are related with foods, beverages, medicines, cosmetics, chemical products, biological products, genetically engineer products, and to be used goods which are worn, used, or utilized by the public. And Halal Product is a product that has been declared Halal in accordance with Islamic Sharia.

Organizing the Halal Product Guarantee

The Government organizes the Halal Product Guarantee by establishing Halal Product Guarantee Organizing Agency (“BPHJPH”) which cooperates with ministries and/or related agencies, Halal Inspection Agency (LPH), and the Indonesian Council of Religious Scholars (MUI). The cooperation between BPJPH and LPH is to inspect and/or test the product. And, the cooperation between BPJPH and the MUI are conducted in a form of:

  1. Halal Auditor Certification;
  2. Determination of the Halal status of a product,
  3. and LPH accreditation

Materials and Halal Product Process

Materials used in the Halal Product Process include raw materials, processed materials, additional materials, and auxiliary materials. These materials may come from animals, plantations, microbe, or materials that are produced through chemical, biological, or genetic engineering process which are basically Halal except those that are declared forbidden (haram) in accordance to the Islamic Sharia, which are carcass, blood, pig, and/or animals that are not slaughtered in accordance with the Sharia.

Locations, places, and tools of Halal Product Process must be separated from the locations, places, and tools for slaughtering, processing, storing, packing, distributing, selling, and presenting Non-Halal products. These locations, places, and tools must be kept clean and hygienic, free from unclean (najis), and free from Non-Halal materials.

Business actor Obligations

Business actor that submits application for Halal Certificate must:

  1. Provide correct, clear, and truthful information.
  2. Separate the locations, places, and tools to process, store, pack, distribute, sale, and present Halal products and
  3. Non-Halal products Has a Halal supervisor, and Report changes of material compositions to the BPJPH

Business actor that has acquired the Halal Certificate must:

Include Halal Label in the product that has acquired Halal Certificate;

  1. Maintain the Halal condition of the product that has acquired Halal Certificate. Non-compliance to this stipulation is punishable by a maximum jail time of 5 years or IDR 2 billion penalties;
  2. Separate the locations, places, and tools to process, store, pack, distribute, sale, and present Halal products and Non-Halal products;
  3. Re-new the Halal Certificate if the Certificate is no longer valid;
  4. Report changes of material compositions to the BPJPH

Business actor that produces products from material sourced from forbidden (haram) materials is excluded from the submission of Application for Halal Certificate. However, this business actor must include Non-Halal information in its products.

Procedures to Acquire Halal Certificate

An application for Halal Certificate is submitted by business actor in writing to the BPJPH along with the following documents:

  1. Business information;
  2. The name and type of product;
  3. List of products and materials that are used;
  4. The process of product processing

After received, BPJPH determines the LPH that is going to inspect and/or test whether the product is Halal or not. The determination of LPH is conducted within 5 working days since the document of application has been declared complete. The testing and/or inspection of the product to determine if the product is Halal or not is conducted by a Halal Auditor in the business location in the production process.

LPH submits result of the Halal product inspection and/or testing to the BPJPH, which delivers the result to MUI to acquire a stipulation on condition of Halal or Non-Halal of the product.The MUI stipulates the condition of Halal or Non-Halal in an Instruction Session (Sidang Fatwa) within 30 business days since the MUI received the inspection and/or testing result from BPJPH. The stipulation of Halal Product by the MUI is delivered to the BPJPH and used as a base to issue the Halal Certificate within 7 business days since the stipulation on the Halal status was received from the MUI. The Certificate is valid for 4 years since its issuance.

Business that has acquired the Halal Certificate must include Halal Label that can be easily seen, read and not easily erased, taken off, and tampered in the product packaging, certain part of the product, and/or certain place of the product. Business that includes Halal Label that is not in accordance with these provisions is subject to administration sanction in a form of:

  1. Verbal warning;
  2. Written warning, or
  3. Revocation of Halal Certificate

Transitional Provisions

Halal Certificate that has been issued by the MUI before the issuance of the Halal Law is still valid until it expires. And before the BPJPH is established, submission of request or renewal of Halal Certificate is performed in accordance with the procedure to acquire Halal Certificate that is in effect before the Halal Draft Law is registered.

Implementing Regulations

The Halal Draft Law mandates the issuance of several Government Regulations to regulate the authority of BPJPH and its cooperation with ministries, related agencies, LPH, and MUI. And also further regulate LPH, Halal Product Process, Halal Certification, International Cooperation, Halal Certificate Registration procedures, Supervision, and type of halal certified products. Also mandated is the issuance of several Ministerial Regulations to regulate the procedure for imposing administration sanctions, further regulate halal supervisor, procedure to submit Halal Certificate Application, procedure to appoint LPH, Halal Label, Halal Certificate Renewal, BPJPH Financial Management, and appreciation for public involvements.

Finally, consumers’ protection is actually an issue that most of all companies should be aware. In this case, Indonesia as one of biggest Moslem and 250 million population is also a potential market.


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