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:
- Food and beverages;
- Chemical products;
- Genetically modified products;
- Biological products; and
- Other goods people utilize.
- Animal slaughter; and
What is the Halal Certification Process?
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.
Submitting the Halal Certificate Application
Anyone conducting business in Indonesia, whether a formal corporation or a more informal partnership, can apply for a Halal certificate. For starters, they need to fill out an electronic application with the Halal Product Assurance Agency (Badan Penyelenggara Produk Halal – BPJPH), the government agency responsible for enforcing Halal product warranties.
After submitting an e-application, both the BPJPH and the applicant will collaborate to select a Halal Inspection Agency (Lembaga Pemeriksa Halal – LPH) to carry out the necessary testing by the criteria established by the BPJPH. If the LPH doesn’t get their inspection done within 15 days of registering, they could face penalties.
After the inspection, the LPH will forward its findings to the Indonesian Ulama Council (Majelis Ulama Indonesia – MUI), the authority responsible for deciding whether or not a given product or service is Halal. After the MUI receives the LPH’s findings, the MUI will issue a judgment within three business days. This is a huge improvement on the prior regulations, which required a response from the MUI within 30 business days.
Within one working day of the verdict, the BPJPH will issue the Halal certificate. It takes four years for the Halal certification to expire.
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.