HALAL LABELING AND ITS IMPACT ON SALES TURNOVER
The majority of consumers who adhere to Islam ascertain the lawfulness (halal) of a product before consumption. The status of halal directly affects the level of sales and use of a product. Importantly, a product’s halal status must be established on the basis of evidence, not mere assumption.
What is a Halal Product?
Article 1 paragraph (1) of Act No. 33 of 2014 concerning Halal Product Assurance (the “Halal Product Assurance Act” / UU JPH) defines a product as goods and/or services connected with food, beverages, pharmaceuticals, cosmetics, chemical products, biological products, genetically engineered products, and consumer goods utilized by the public. Under Article 1 paragraph (2) UU JPH, a halal product is a product whose raw materials and manufacturing process have been declared halal in accordance with Islamic law.
Legally (juridically), a product is recognized as halal only after it has obtained a Halal Certificate defined in Article 1 paragraph (10) UU JPH as an official acknowledgment of halal status issued by the Halal Product Assurance Agency (BPJPH) based on a written religious decree (fatwa) issued by the Indonesian Ulema Council.
Procedure for Obtaining a Halal Certificate
Any business actor (undertaking/trader) wishing to secure a halal certificate must file an application with BPJPH, enclosing documents including: the applicant’s data, the name and type of product, a list of ingredients, and a description of the production process (Article 29 UU JPH).
Upon issuance of the certificate, the business actor assumes statutory duties under Article 25 UU JPH, including:
- Affixing the Halal Label on products certified halal.
- Maintaining the halal integrity of certified products.
- Segregating locations, slaughterhouses, processing equipment, storage, packaging, distribution, sale, and presentation between halal and non-halal products.
- Renewing the certificate upon expiration.
- Reporting any changes in composition of raw materials to BPJPH.
Halal Labeling
The Halal Label may only be affixed to products that have been granted a Halal Certificate. Business actors without certification are prohibited from using the label, as there is no legal certainty regarding halal status in terms of raw materials and production processes (processing, storage, packaging, distribution, sale, or presentation).
Monitoring and Sanctions
Consumers and potential consumers may play an active role in enforcing halal product assurance by reporting or filing complaints to BPJPH regarding products in circulation.
Business actors holding a Halal Certificate but failing to comply with obligations may be subject to administrative sanctions and/or criminal liability:
- Administrative sanctions include written warnings, administrative fines, and possible revocation of the certificate.
- Criminal sanctions (Article 56 UU JPH): imprisonment up tofive years or a monetary fine up to IDR 2,000,000,000 for certified business actors who fail to maintain halal integrity.
Likewise, business actors who affix a halal label without holding a valid certificate may be subject to criminal sanctionsunder Article 62 of Act No. 8 of 1999 concerning Consumer Protection: imprisonment up to five years or a fine up to IDR 2,000,000,000.
Conclusion
Business actors obtaining halal certification from BPJPH are legally obligated to affix the halal label and maintain halal standards. Failure to comply either by not safeguarding halal integrity after certification or by affixing a halal label without certification may result in criminal sanctions of imprisonment up to five years or a fine up to IDR 2,000,000,000.
Legal Basis
- Act No. 33 of 2014on Halal Product Assurance.
- Act No. 8 of 1999on Consumer Protection.
Authors:
Salma Ariana Taruna, S.H.
Eva Rutnauli Sinaga
Editor:
Muhammad Arief Ramadhan, S.H.