How to Obtain Halal Certification in Indonesia?

In a country where over 87% of the population identifies as Muslim, Indonesia’s halal industry is not just a religious obligation—it’s a booming economic powerhouse. With the implementation of the Halal Product Assurance Law (Law No. 33 of 2014), halal certification has become mandatory for a wide range of products and services. But how can businesses navigate the complex process of obtaining halal certification in Indonesia? Whether you’re a local entrepreneur or an international company looking to tap into this lucrative market, this comprehensive guide will walk you through everything you need to know about securing halal certification in Indonesia.

Indonesia, the world’s largest Muslim-majority country, has taken significant steps to ensure that products and services meet Islamic standards. Halal certification is no longer just a label; it’s a legal requirement for food, beverages, cosmetics, pharmaceuticals, and even services like logistics and tourism. For businesses, obtaining halal certification is not only a way to comply with regulations but also a strategic move to gain consumer trust and access a market of over 230 million Muslims.

This article will provide a detailed roadmap for businesses seeking halal certification in Indonesia, covering the legal framework, application process, costs, and tips for success. By the end, you’ll have a clear understanding of how to navigate this essential process and position your business for growth in Indonesia’s halal industry.

Business owners in Indonesia must follow the rules outlined in GR 39/2021 to ensure their products and services are Halal-compliant. All goods imported into, distributed within, or sold within Indonesia must be Halal-approved.

It is the responsibility of enterprises to apply to the Halal Product Assurance Agency for certification. The government department will then choose a Halal Inspection Agency to evaluate the company’s goods and services.

For the food, travel, beauty, and medicine industries, Indonesia has the largest Halal market worldwide. Before the pandemic, spending on Halal goods and services reached over US$2 trillion worldwide, with customers in Indonesia contributing roughly 10%, or over US$200 billion.

Government Regulation 39 of 2021 (GR 39/2021), Indonesia’s Halal certification rule, was released in October 2021 and would have repercussions throughout industries. Halal certification is mandatory for all goods entering, circulating inside, or being traded within Indonesia as per GR 39/2021. This is the case unless the goods are made from a banned substance in Islam (Haram).

The Omnibus Law’s implementing regulations include GR 39/2021, which will take effect in November of that year. As a whole, the Omnibus Law makes changes to 76 other laws to improve Indonesia’s economic climate, attract more foreign investment, and producing more new jobs. Materials and methods used in production, including warehousing, packaging, and retail presentation, must all conform to Halal standards for a product to be certified Halal by GR39/2021.

Indonesia, with the largest Muslim population, is also the largest Halal market globally, especially in the food, tourist, cosmetics, and pharmaceutical industries. Before the epidemic, spending on Halal goods and services reached over US$2 trillion worldwide, with customers in Indonesia contributing roughly 10%, or over US$200 billion.

Government Regulation 39/2021 officially nullifies Government Regulation 31/2019 regarding Halal certification.

Which Products and Services Must Be Halal Certified?

According to GR 39/2021, the following goods and services must be Halal-certified:

Goods

• Food and beverages;
• Pharmaceuticals;
• Cosmetics;
• Chemical products;
• Genetically modified products;
• Biological products; and
• Other goods people utilize.

Services

• Processing;
• Storage;
• Packaging;
• Distribution;
• Animal slaughter; and
• Sales.

Why is Halal Certification Mandatory in Indonesia?

1. Legal Compliance: The Halal Product Assurance Law mandates that all products and services entering the Indonesian market must be halal-certified by October 2024.
2. Consumer Trust: Halal certification assures Muslim consumers that a product meets their religious requirements.
3. Market Access: With a growing demand for halal products, certification opens doors to both domestic and international markets.

What is the Halal Certification Process in Indonesia?

Each Halal certificate now costs between US$21 to US$351, and thanks to GR 39/2021, the certification process is much quicker. Halal certification, certificate renewal, international certificate registration, and the introduction of new products or services all incur fees that are subject to the regulations outlined in Minister of Finance Regulation 57 of 2021.

The government would offer Halal certifications at no cost to micro and small businesses (MSEs). Furthermore, the government hopes to certify 13.5 million MSEs around the country.

Step-by-Step Guide to Obtaining Halal Certification in Indonesia

1. Determine Eligibility

• Identify whether your product or service falls under the categories requiring halal certification (e.g., food, beverages, cosmetics, pharmaceuticals).
• Ensure your production process complies with halal standards, including sourcing, handling, and storage.

2. Prepare Required Documents

• Business license (SIUP/TDP).
• Product formulation and ingredient list.
• Production process flowchart.
• Halal compliance statement from suppliers.
• Facility layout and sanitation procedures.

3. Register with BPJPH

• Create an account on the BPJPH online portal.
• Submit the application form along with the required documents.
• Pay the registration fee, which varies depending on the type and scale of your business.

4. Halal Audit and Inspection

• BPJPH will assign a halal auditor to inspect your facility and production process.
• The auditor will verify that all ingredients, equipment, and processes comply with halal standards.

5. Certification Issuance

• If your product passes the audit, BPJPH will issue a halal certificate.
• The certificate is valid for four years and must be renewed before expiration.

What about Imported Goods or Services?

The BPJPH requires registration for all Halal-certified products and services imported into Indonesia from other countries.

Foreign Halal certificates require the following in addition to registration:

• Information provided by the candidate;
• An authenticated duplicate of the Halal certificate issued by a foreign country’s embassy or consulate of Indonesia.
• List of items and services to be imported into Indonesia, including Harmonized System (HS) codes.
• A statement attesting to the authenticity and validity of the supporting documentation.

Halal Certification for Micro and Small Enterprises

As a first step, MSEs must submit a self-declaration to the BPJPH establishing their status as an MSE under the applicable statute. As an MSE, you may get your hands on one of these Halal certificates at no cost to you.

In addition, the MSE needs to adhere to these requirements:

There are no ingredients or steps in the manufacturing process that would cause the products to not be Halal, and there is no chance of any non-Halal ingredients or steps getting into the final product.

The Halal certification compliance period

The government has given companies ample time to adapt their procedures to comply with Halal standards. The government recognizes the need of ensuring that only certain types of products can be certified as Halal, thus they have established criteria for doing so.

The Role of LPPOM MUI in Halal Certification

The Indonesian Council of Ulama’s Assessment Institute for Foods, Drugs, and Cosmetics (LPPOM MUI) plays a crucial role in the halal certification process. While BPJPH is the regulatory body, LPPOM MUI conducts the technical assessments and audits. Businesses must work closely with both organizations to ensure compliance.

The Economic Impact of Halal Certification in Indonesia

Indonesia’s halal industry is projected to reach $281 billion by 2025, making it one of the largest halal markets in the world. Halal certification is not just a regulatory requirement; it’s a gateway to this thriving industry. For businesses, certification can lead to increased sales, brand loyalty, and opportunities for export.

Obtaining halal certification in Indonesia is more than just a regulatory hurdle—it’s a strategic investment in your business’s future. By complying with halal standards, you not only gain access to a massive consumer base but also demonstrate your commitment to ethical and religious values. As Indonesia’s halal industry continues to grow, businesses that prioritize certification will be well-positioned to thrive in this dynamic market.

Frequently Asked Questions (FAQs)

1. How long does the halal certification process take?

The process typically takes 3-6 months, depending on the complexity of your product and production process.

2. What is the cost of halal certification in Indonesia?

Costs vary based on the type of product and scale of production, ranging from $500to$5,000.

3. Can foreign companies obtain halal certification in Indonesia?

Yes, foreign companies can apply for halal certification, but they must comply with the same requirements as local businesses.

4. Is halal certification mandatory for all products?

Yes, by October 2024, all products and services in Indonesia must be halal-certified.