Halal Law Update

Businesses in wait-and-see mode for government to settle issues with mandatory halal certification

By Gilang Ardana
Tuesday, March 13, 2018

In the latest inter-ministerial meeting led by the State Secretariat on February 2 to discuss government regulations on Halal certification, it was reported that many ministries attending disagreed with a draft presented by the Ministry of Religious Affairs. The State Secretariat decided to give the draft back to the religious affairs ministry to be adjusted based on concerns from other ministries.

This added to the long debate over government attempts to create implementing regulations for Law No. 33 of 2014 on Halal Product Assurance (the Halal Law). The law stirred controversy as it shifted voluntary halal certification to mandatory certification and expanded the object of certification to all “goods and/or services that are related to food, beverages, drugs, cosmetics, chemical products, biological products, genetically engineered products, as well as consumer goods that are worn, used or utilized by the public.”

The government was mandated by the law with two significant tasks:  to create its own certification body – the Halal Product Assurance Organizing Agency (BPJPH) – which was inaugurated in October 2017; and to settle the mechanism for halal registration. The latter task invited heavy debate with various industry associations due to the complexity of the issue.

In a seminar on January 24, a BPJPH representative said the implementing regulation would call for the complete implementation of the Law, including for pharmaceuticals, by October 2019, while previously it was reported that the pharma side of the Law would be phased in over a five-year period.

The Ministry of Law and Human Rights reportedly decided the phasing was inconsistent with Article 67 of the 2014 law, which it interpreted as requiring full implementation by 2019, hence no grace period for pharma. The inclusion of pharma under the mandatory demand that all products go through the Halal certification process raised serious concerns about market access for pharmaceutical products in Indonesia. 

Officials also noted in the seminar that there would be no legal sanctions for noncompliance with the mandatory certification, because the law did not specify any sanctions. This led the private sector to adopt a wait-and-see mode on the regulation.

Paustinus Siburian, an advocate, filed a judicial review of the Halal Law and the first session of the review was in early January. On February 21, the Constitutional Court rejected the motion, ending the judicial review process of the Law. In its decision, the court said that the request filed was unclear.

Businesses are now waiting for the next update from the drafting of the implementing regulations. AmCham will keep monitoring developments on this issue.

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