Vol 2, No 1 (2021) 33–45

Map­ping Out Halal Cer­ti­fi­ca­tion in Indone­sia and Malaysia: Chal­lenges, Oppor­tu­ni­ties, and Com­par­a­tive Advan­tage

Achmad Tohe1, Kholisin Kholisin1, Moch Wahib Dariya­di1, Nori­tah Omar2

1Ara­bic Depart­ment, Uni­ver­si­tas Negeri Malang, 65145, Indone­sia.
2 Eng­lish Depart­ment, Uni­ver­si­ti Putra Malaysia, Ser­dang, 43400, Malaysia.

Cor­re­spon­dence should be addressed to Achmad Tohe: achmad.​tohe.​fs@​um.​ac.​id

Cite this: Nusan­tara Halal J. 2021, Vol. 2 No.1 pp. 33–45 (Arti­cle) | Received 24 Feb­ru­ary 2021 | Revised 2 May 2021 | Accept­ed 10 June 2021 | Pub­lished 30 June 2021 | http://​dx​.doi​.org/​1​0​.​1​7​9​7​7​/​u​m​0​6​0​.​2​0​2​1​v​2​p​0​3​3​-​045

Abstract

This study sought to map out the insti­tu­tions and process­es of halal cer­ti­fi­ca­tion in Indone­sia and Malaysia by inves­ti­gat­ing the his­to­ry, pro­ce­dures, chal­lenges, and oppor­tu­ni­ties. Data were gath­ered through inter­views with those work­ing in halal cer­ti­fy­ing relat­ed insti­tu­tions, such as MUI and BPJPH in Indone­sia, and JAKIM in Malaysia, in addi­tion to sev­er­al halal audi­tors from uni­ver­si­ties in both coun­tries. A close read­ing of pri­ma­ry doc­u­ments issued by halal cer­ti­fi­ca­tion insti­tu­tions and sec­ondary doc­u­ments, aca­d­e­m­ic arti­cles, and online resources was con­duct­ed to bet­ter under­stand the issues at hand. The results sug­gest that while his­tor­i­cal­ly halal cer­ti­fi­ca­tion in Indone­sia and Malaysia came from two dif­fer­ent tra­jec­to­ries, the two final­ly con­verged in acknowl­edg­ing the impor­tant role of the state and gov­ern­ment in terms of Mus­lim con­sumer pro­tec­tion in rela­tion to their halal needs. Nonethe­less, their dif­fer­ing evo­lu­tion­ary paths, which was part­ly the func­tion of the rel­a­tive sta­tus of Islam in both, had even­tu­al­ly shaped the char­ac­ter of their halal cer­ti­fi­ca­tion. Orig­i­nat­ing from an organ­ic civ­il soci­ety move­ment, halal cer­ti­fi­ca­tion in Indone­sia tra­versed through a more sta­ble and cul­tur­al­ly con­sol­i­dat­ed process, while in Malaysia, it took the polit­i­cal high­way with its atten­dant ups and downs. If Indone­sia man­aged to cre­ate “umbrel­la halal law” over­see­ing oth­er less­er pro­vi­sions, Malaysia had to accept the fact that fed­er­a­tion had some imprint on its vast array of dis­pers­ing halal pro­vi­sions, if often com­pen­sat­ed with some mend­ing for improve­ment. Final­ly, the char­ac­ter and size of the pop­u­la­tion of each con­tributed to mak­ing Indone­sia be more inward-look­ing and Malaysia out­ward-look­ing in their halal cer­ti­fi­ca­tion management.

Key­words: Halal cer­ti­fi­ca­tion, chal­lenges, oppor­tu­ni­ties, com­par­a­tive advantage.

Introduction

The glob­al halal indus­try has grown expo­nen­tial­ly due to the sig­nif­i­cant growth of the Mus­lim pop­u­la­tion, their aware­ness of Islam­ic rul­ings on halal and haram  [1], the increase of pur­chas­ing pow­er among Mus­lim con­sumers [2], and the expan­sion of halal mar­ket itself that has now includ­ed non-Mus­lim as both con­sumers and play­ers  [3]. The steady rise of halal demand has accord­ing­ly cre­at­ed a vari­ety of inter­na­tion­al halal assur­ance ini­tia­tives, espe­cial­ly through the estab­lish­ment of halal cer­ti­fi­ca­tion bod­ies and the rat­i­fi­ca­tion of halal laws in dif­fer­ent coun­tries, Mus­lim and non-Mus­lim alike [4].

The imple­men­ta­tion of halal assur­ance sys­tem is essen­tial in order to ensure the effec­tive and effi­cient pro­duc­tion of halal prod­ucts and ser­vices [5], the key com­po­nent of which is a halal cer­ti­fi­ca­tion process [6]. Halal cer­ti­fi­ca­tion is the process of cer­ti­fy­ing prod­ucts or ser­vices to be com­pli­ant with the shari­ah law [7], in terms of per­mis­si­bil­i­ty, in addi­tion, in cer­tain cas­es, to oth­er stan­dards of qual­i­ty [8], such as health, hygiene, envi­ron­men­tal friend­li­ness, and respect for ani­mal wel­fare. While ini­tial­ly it was enforced on prod­ucts and ser­vices for Mus­lims’ con­sump­tion, pri­mar­i­ly due to reli­gious require­ments, halal cer­ti­fi­ca­tion is now con­sid­ered a cer­ti­fi­ca­tion stan­dard for qual­i­ty in gen­er­al [9].

Halal cer­ti­fi­ca­tion, how­ev­er, did not actu­al­ly start in the Mus­lim coun­tries, but in the Unit­ed States in the mid-1960s, ini­ti­at­ed by food and tech­ni­cal Mus­lim experts, pri­mar­i­ly to serve the need of Mus­lims in ful­fill­ing their reli­gious oblig­a­tion and to pre­serve their iden­ti­ty in the midst of oth­er, non-Mus­lim, com­mu­ni­ties [6]. In the begin­ning, halal cer­ti­fi­ca­tion applied almost exclu­sive­ly to food prod­ucts and bev­er­ages, but over time it began to include non­foods, such as cos­met­ics and phar­ma­ceu­ti­cal prod­ucts, and even ser­vices, such as logis­tics, trav­el, and tourism [3,10,11]. Today, halal cer­ti­fi­ca­tion is the pre­req­ui­site for enter­ing the glob­al halal mar­ket [6]. Fur­ther­more, the present halal mar­ket is non-exclu­sive to Mus­lims but has gained increas­ing accep­tance among non-Mus­lim indus­try play­ers and con­sumers, who asso­ciate halal with eth­i­cal con­sumerism [8]. Thus, halal accred­i­ta­tion serves as a bench­mark for food safe­ty, qual­i­ty assur­ance, and oth­er use­ful indi­ca­tors, not only for Mus­lim but also non-Mus­lim cus­tomers [12], [13]. Unex­pect­ed­ly, the largest export­ing pro­duc­er of halal and poul­try, for instance, were non-Mus­lim coun­tries, such as New Zealand and Aus­tralia [3].

This paper aims to map out the halal cer­ti­fi­ca­tion process in Indone­sia and Malaysia, probe the his­tor­i­cal devel­op­ment, iden­ti­fy its insti­tu­tions and pro­ce­dures, scru­ti­nize the chal­lenges and oppor­tu­ni­ties, and, final­ly, weigh on the com­par­a­tive advan­tage to one anoth­er. It is impor­tant to study halal assur­ance sys­tem whose imple­men­ta­tion is essen­tial to ensure the effec­tive and effi­cient pro­duc­tion of halal prod­ucts. Halal assur­ance sys­tem is devel­oped based on three zero’s con­cepts, which are zero lim­it (no haram mate­r­i­al used in the pro­duc­tion), zero defect (no haram prod­uct is pro­duced) and zero risk (no dis­ad­van­ta­geous risk should be tak­en by the pro­duc­er or com­pa­ny). Con­se­quent­ly, the struc­ture for halal assur­ance sys­tems plays a vital role in inte­grat­ing the process­es that assist the estab­lish­ment of val­ue with­in firms and across the sup­ply chain [5].

Methods

This study of halal cer­ti­fi­ca­tion in Indone­sia and Malaysia was con­duct­ed through a com­bi­na­tion of inter­views, doc­u­ment analy­sis, and lit­er­a­ture review. Inter­views were under­tak­en with per­son­nel who were work­ing in halal-relat­ed insti­tu­tions in both coun­tries, includ­ing MUI and BPJPH in Indone­sia, and JAKIM in Malaysia, in addi­tion to some halal audi­tors in uni­ver­si­ties, such as Uni­ver­si­tas Air­lang­ga and Uni­ver­si­ti Putra Malaysia. Offi­cial doc­u­ments ana­lyzed were those offi­cial­ly issued by both gov­ern­ments and halal cer­ti­fy­ing insti­tu­tions, acces­si­ble in print and online. The lit­er­a­ture review was accom­plished by sur­vey­ing a num­ber of sec­ondary sources, espe­cial­ly rel­e­vant pub­lished aca­d­e­m­ic arti­cles, gained through  http://​link​.springer​.com, https://​www​.sci​encedi​rect​.com/, http://​tand​fon​line​.com/, and https://​schol​ar​.google​.com/. Issues addressed includ­ed the evo­lu­tion of halal cer­ti­fi­ca­tion efforts, insti­tu­tions, and pro­ce­dures, in addi­tion to some chal­lenges faced and oppor­tu­ni­ties expect­ed. All gath­ered data were then con­front­ed with each oth­er, which even­tu­al­ly led to a com­par­a­tive analy­sis that delin­eat­ed the rel­a­tive com­par­a­tive advan­tage of halal cer­ti­fi­ca­tion man­age­ment in Indone­sia and Malaysia.

Results and Discussion

History of Halal Certification in Indonesia and Malaysia

In terms of its ori­gin, the ini­tia­tive for halal cer­ti­fi­ca­tion in Indone­sia and Malaysia came from two dif­fer­ent paths. In Indone­sia, the idea of halal cer­ti­fi­ca­tion was gen­er­at­ed with­in, and sub­se­quent­ly run, by the Indone­sian Coun­cil of Ula­ma (MUI, Majelis Ula­ma Indone­sia), which was a non-gov­ern­men­tal sociore­li­gious insti­tu­tion, while in Malaysia, it was cul­ti­vat­ed by gov­ern­ment and used to be the only one in the world with the gov­ern­ment full sup­port in this respect [14]. The more like­ly rea­son for that was the dif­fer­ent sta­tus of Islam with­in each state [15]. While both are equal­ly Mus­lim coun­tries, Malaysia has made Islam as the offi­cial reli­gion of the state, and Indone­sia is polit­i­cal­ly sec­u­lar, in that it treats all offi­cial­ly rec­og­nized reli­gions, includ­ing Islam, on an equal foot­ing [16]. Con­se­quent­ly, the next tra­jec­to­ry of halal cer­ti­fi­ca­tion in Indone­sia and Malaysia, once again, took dif­fer­ent dynamics.

In Indone­sia, the his­to­ry of halal cer­ti­fi­ca­tion has tak­en a rel­a­tive­ly lin­ear route, con­sist­ing of two major phas­es, name­ly before and after the pro­mul­ga­tion of Law No 33 of 2014 about Halal Prod­uct Assur­ance  (UUJPH, Undang-Undang Jam­i­nan Pro­duk Halal) [17]. Before UUPJH came into exis­tence, MUI was the sole insti­tu­tion respon­si­ble for halal cer­ti­fi­ca­tion in Indone­sia [9]. Two of its sub-body, LPPOM MUI (the Assess­ment Insti­tute for Food, Drugs, and Cos­met­ics, Lem­ba­ga Pengka­jian Pan­gan, Obat-obatan, dan Kos­meti­ka), estab­lished in Jan­u­ary 1989, and the Fat­wa Com­mis­sion, played a major role in this task. LPPOM car­ried out the exam­i­na­tion of the ingre­di­ents con­tained in a prod­uct, while the Fat­wa Com­mis­sion deter­mined the com­pli­ance of the prod­uct at hand with the Shari­ah law [18].

In so doing, MUI signed a mem­o­ran­dum of under­stand­ing (MOU) with the Min­istry of Reli­gious Affairs, which was fol­lowed by the issuance of the Decree of the Min­is­ter of Reli­gious Affairs (Kepu­tu­san Menteri Aga­ma, KMA) No 518 of 2001 and KMA 519 Year 2001, which strength­ened MUI posi­tion as the halal cer­ti­fy­ing insti­tu­tion with an author­i­ty to examine/​audit, issue fat­wa, and pub­lish a halal cer­tifi­cate. In addi­tion, LPPOM-MUI worked hand in hand with BPOM (Agency for Food and Drugs Con­trol, Badan Pen­gawasan Obat dan Makanan), Min­istry of Reli­gious Affairs, Min­istry of Agri­cul­ture, Min­istry of Coop­er­a­tives and Small and Medi­um Enter­pris­es, Trade Min­istry, Min­istry of Indus­try, Marine and Fish­eries Min­istry, Min­istry of Tourism and Cre­ative Econ­o­my, and sev­er­al uni­ver­si­ties. Regard­less, it was MUI that had the full author­i­ty for halal cer­ti­fi­ca­tion, while its rela­tion with the oth­er insti­tu­tions was large­ly coor­di­na­tive as well con­sul­ta­tive [14]. Halal Cer­ti­fi­ca­tion Stan­dard of LPPOM MUI was based on the Halal Assur­ance Sys­tem Con­cept on Food, Drugs, and Cos­met­ic (HAS 23000), Guide­lines of Halal Assur­ance Sys­tem Cri­te­ria of Slaugh­ter­hous­es (HAS 23103) and Require­ments of Halal Food Mate­r­i­al (HAS 23201) [14].

When UUJPH came into exis­tence, the Indone­sian gov­ern­ment had since tak­en over the author­i­ty for halal cer­ti­fi­ca­tion in the coun­try [19]. Based on the man­date of the new law, the Indone­sian gov­ern­ment, in Octo­ber 2017, estab­lished a state-owned insti­tu­tion, name­ly BPJPH (Badan Penye­leng­gara Jam­i­nan Pro­duk Halal, Halal Prod­uct Assur­ance Orga­niz­ing Agency) as the new main body respon­si­ble for halal cer­ti­fi­ca­tion [20]. The pro­mul­ga­tion, in Indone­sia, of Law No 33 2014 on Halal Prod­uct Assur­ance has brought about legal cer­tain­ty in terms of halal assur­ance, espe­cial­ly through halal cer­ti­fi­ca­tion. Soci­o­log­i­cal­ly, the pres­ence of such law cre­at­ed a sense of com­fort and safe­ty in soci­ety, espe­cial­ly Mus­lims, about pro­duc­tion and con­sump­tion. Eco­nom­i­cal­ly, the same law of Halal Prod­uct Assur­ances opened up new rev­enues and busi­ness pos­si­bil­i­ties [21].

Although the author­i­ty for halal cer­ti­fi­ca­tion in Indone­sia has for­mal­ly been trans­ferred, on the basis of Law No 33 of 2014, from MUI to BPJPH, this does not nec­es­sar­i­ly rule out the sig­nif­i­cant role that MUI could play in the future [22]. MUI has been suc­cess­ful in build­ing its high­ly respect­ed rep­u­ta­tion as a trust­ed halal cer­ti­fi­er, domes­ti­cal­ly and inter­na­tion­al­ly, through its LPPOM [9]. In fact, MUI had cre­at­ed a viable mod­el of halal cer­ti­fi­ca­tion insti­tu­tion that BPJPH inher­it and may improve it where nec­es­sary. There­fore, while retain­ing much less author­i­ty than it had pre­vi­ous­ly had, MUI could still main­tain a vital role, as stat­ed in Arti­cle 10 of UUJPH, about halal audi­tor cer­ti­fi­ca­tion, stip­u­lat­ing halal sta­tus of a prod­uct, and LPH accreditation.

Mean­while, the evo­lu­tion of halal cer­ti­fi­ca­tion in Malaysia, includ­ing its insti­tu­tions, nomen­cla­tures, reg­u­la­tions, and scope of author­i­ty, has been unsta­ble and con­fus­ing, to say the least, and it was fur­ther com­pli­cat­ed by the fact that Malaysia is a fed­er­al state that acknowl­edges the exis­tence of dual gov­ern­ment at the cen­tral and state lev­el, which has accord­ing­ly affect­ed the man­age­ment of halal cer­ti­fi­ca­tion. Insti­tu­tion­al­ly, it start­ed in 1968, when the Malaysian Coun­cil of Rulers decid­ed that there was a need for a body that could mobi­lized the devel­op­ment and progress of Mus­lims in the coun­try.  As a result, the Sec­re­tari­at of the Nation­al Coun­cil for Islam­ic Affairs of Malaysia was formed to pro­tect the puri­ty of faith and teach­ings of Islam. The Sec­re­tari­at was lat­er expand­ed to become the Reli­gious Divi­sion, under the juris­dic­tion of the Prime Min­is­ter. Giv­en the impor­tant role of the body to main­tain and pre­serve the inter­ests of Mus­lims, this reli­gious divi­sion was then upgrad­ed to become the Islam­ic Affairs Divi­sion (BAHEIS, Baha­gian Hal Ehw­al Islam), which began to issue halal recog­ni­tion let­ters for food and con­sum­ables, pro­duced by local entre­pre­neurs, in Malaysia since 1974. Start­ing in 1994, Halal cer­ti­fi­ca­tion was no longer in the form of recog­ni­tion, but in the form of a cer­tifi­cate, togeth­er with Halal logo, to be used or dis­played on the goods. On Jan­u­ary 1, 1997, the Islam­ic Devel­op­ment Depart­ment of Malaysia (Jabatan Kema­juan Islam Malaysia, JAKIM) was estab­lished by the gov­ern­ment to take over the role of BAHEIS [23,24]. Irre­spec­tive of fur­ther inter­nal dynam­ics [25], today JAKIM is the core body that con­trols the admin­is­tra­tion of the Malaysian halal cer­ti­fi­ca­tion and issues halal logos [1,9]. How­ev­er, apart from JAKIM whose juris­dic­tion is on the fed­er­al lev­el, the State Islam­ic Reli­gious Depart­ment (JAIN, Jabatan Aga­ma Islam Negeri) or State Islam­ic Reli­gious Coun­cils (MAIN, Jabatan Aga­ma Islam Negeri) are also accept­ed bod­ies for halal cer­ti­fi­ca­tion on the state lev­el.  If JAKIM has the author­i­ty to issue a halal cer­tifi­cate for domes­tic and multi­na­tion­al prod­ucts, JAIN/​MAIN is to issue a halal cer­tifi­cate for domes­tic prod­ucts only [9,12,26]. Pri­or to the year 2009, there used to be dif­fer­ent halal logos that the states applied. How­ev­er, the Malaysian gov­ern­ment then did some har­mo­niza­tion and adopt­ed only Malaysia halal logo for all states [9].

To com­pli­cate even fur­ther, in addi­tion to JAKIM, JAIN, and MAIN, there are oth­er pub­lic insti­tu­tions that deal with halal relat­ed mat­ters, name­ly Halal Indus­try Devel­op­ment Cor­po­ra­tion (HDC), Min­istry of Domes­tic Trade, Co-oper­a­tives and Con­sumerism (MDTCC), Min­istry of Health (MOH) and Min­istry of Inter­na­tion­al Trade and Indus­try (MITI). Togeth­er, these sev­en agen­cies share huge respon­si­bil­i­ty for halal assur­ance in Malaysia, and they all play a cer­tain role, albeit, intrigu­ing­ly, act­ing accord­ing to their own terms of ref­er­ence [24]. Apolo­get­i­cal­ly, the involve­ment of so many dif­fer­ent agen­cies in han­dling halal indus­try was due to its broad scope, in which a juris­dic­tion over­lap is inevitable. Objec­tive­ly, how­ev­er, it is the absence of a sin­gle leg­is­la­tion, which specif­i­cal­ly reg­u­lates this indus­try as a whole, that led to the involve­ment of the var­i­ous gov­ern­ment agen­cies in it [26]. How­ev­er, the two main agen­cies that are often asso­ci­at­ed with Halal cer­ti­fi­ca­tion in Malaysia are JAKIM and HDC. JAKIM is focused on halal cer­ti­fi­ca­tion and com­pli­ance with halal stan­dards, while HDC is focused on the devel­op­ment of local and glob­al halal indus­try and mar­ket­ing of halal prod­ucts [23].

Malaysia does not have Laws con­cern­ing halal prod­ucts, but it has 13 sets of pro­vi­sions to sup­port halal cer­ti­fi­ca­tion and also 9 stan­dards for the devel­op­ment of the halal indus­try: 1) Trade Act of 2011 (Trade Law of 2011), 2) Food Act 1983, 3) Food Rules of 1985, 4) Reg­u­la­tions on Food Hygiene of 2009, 5) Ani­mal Rules, 6) Ani­mal Act of 1953, 7) Ani­mal Reg­u­la­tions of 1962, 8) Ani­mal Slaugh­ter­ing, 9) Pub­lic Live­stock Progress of 1983, 10) Law on Pub­lic Live­stock Progress of 1983, 11) Law of Kas­tam 1967 (Pro­hi­bi­tion of Import in 1998), 12) Law of Ker­a­jaan Tem­patan 1976 (Deeds 171), and 13) Local Gov­ern­ment Act (PBT), Act/​Enactment of Islam­ic Admin­is­tra­tion; and Trade Stamp Cer­tifi­cate 1976 [12]. In addi­tion, there are more than 20 cer­tifi­cates that can be referred to the halal cer­ti­fi­ca­tion in Malaysia, for­mu­lat­ed for dif­fer­ent gov­ern­ment agen­cies with dif­fer­ent rights and pow­ers [12,23,24]. There is no ‘umbrel­la law’ that serves as the supreme law of halal relat­ed mat­ters in Malaysia.

Halal Certification Procedure in Indonesia and Malaysia

The pro­mul­ga­tion of UUJPH was a mile­stone in the his­to­ry of halal cer­ti­fi­ca­tion in Indone­sia, dis­tin­guish­ing its two major phas­es. Pri­or to the exis­tence of UUPJH, halal cer­ti­fi­ca­tion in Indone­sia was vol­un­tary, admin­is­tered by a non-gov­ern­men­tal insti­tu­tion, i.e., MUI. After the advent of UUPJH, halal cer­ti­fi­ca­tion in Indone­sia became manda­to­ry. In fact, when it is ful­ly imple­ment­ed, Indone­sia would be the first coun­try in the world to require halal cer­ti­fi­ca­tion for every prod­uct in its mar­ket [17].       

The estab­lish­ment of BPJPH in 2017 by the Min­istry of Reli­gion of the Repub­lic of Indone­sia was a ful­fil­ment of one of the man­dates of UUJPH. BPJPH will facil­i­tate the gen­er­al admin­is­tra­tion process of halal cer­ti­fi­ca­tion [27], includ­ing reg­is­tra­tion, test­ing, and cer­ti­fi­ca­tion process. Based on the UUJPH, the pro­ce­dure for obtain­ing a halal cer­tifi­cate will involve BPJPH, LPH and MUI. First, busi­ness actors must sub­mit a com­plete doc­u­ment as well as a writ­ten appli­ca­tion for a halal cer­tifi­cate to BPJPH. Busi­ness actors can also choose LPH based on the pref­er­ence or prox­im­i­ty of their busi­ness loca­tion to the LPH and BPJPH. BPJPH then deter­mines LPH who has the right to test the halal of the prod­uct with­in a max­i­mum peri­od of 5 work­ing days from the date the com­plete appli­ca­tion doc­u­ment is sub­mit­ted. The next stage is check­ing the halal pro­duc­tion process by halal audi­tors at the busi­ness loca­tion. If there are ingre­di­ents or mate­ri­als that are vague in terms of their halal sta­tus, fur­ther test­ing will be car­ried out in the lab­o­ra­to­ry. After obtain­ing the results, LPH will give the report to BPJPH, which will then be sub­mit­ted to MUI. MUI would deter­mine the legal sta­tus of the prod­uct in the fat­wa com­mis­sion ses­sion, held no more than 30 work­ing days after MUI received the doc­u­ments from BPJPH. Once the deci­sion was made, the final doc­u­ment regard­ing the estab­lish­ment of halal sta­tus of the prod­ucts is then signed by the MUI to be the basis for BPJPH in issu­ing halal cer­tifi­cates, with­in 7 work­ing days after MUI’s final deci­sion. The issuance of the halal cer­tifi­cate must then be pub­lished by BPJPH; thus, its use can be mon­i­tored by the public.

Fig­ure 1. The Process of Halal Cer­ti­fi­ca­tion under BPJPH [17]

While ini­tial­ly it was planned that by Octo­ber 17, 2019, UUJPH would be ful­ly imple­ment­ed but, due to lack­ing some sup­port­ing leg­is­la­tion and infra­struc­ture, BPJPH has yet to wait longer before it could final­ly oper­ate as expect­ed. In the mean­time, the halal cer­ti­fi­ca­tion process In Indone­sia is de fac­to run by MUI, dur­ing this tran­si­tion­al peri­od [17]. Over­all, the reg­is­tra­tion steps are the same as before the pro­mul­ga­tion of UUJPH, with one notable addi­tion, in that the appli­cant must, at the same time, send the appli­ca­tion to both BPJPH and LPPOM MUI.

Fig­ure 2. The Process of Halal Cer­ti­fi­ca­tion dur­ing the Tran­si­tion Peri­od (https://​www​.halal​mui​.org/​m​u​i​1​4​/​m​a​i​n​/​p​a​g​e​/​p​r​o​s​e​d​u​r​-​s​e​r​t​i​f​i​k​a​s​i​-​h​a​l​a​l​-​mui)

The trans­fer of author­i­ty for halal cer­ti­fi­ca­tion from MUI to BPJPH yields a num­ber of sig­nif­i­cant impacts [17]. First, with the gov­ern­ment over­see­ing halal cer­ti­fi­ca­tion, the process is expect­ed to be more effi­cient, trans­par­ent, and account­able, as it can orches­trate all relat­ed par­ties to work in tan­dem and share the respon­si­bil­i­ty. Sec­ond, the cost is expect­ed to be less expen­sive since the gov­ern­ment has more schemes that can help the appli­cants, espe­cial­ly when they are clas­si­fied as micro and small busi­ness­es, as stat­ed in Arti­cle 44 of UUJPH. Third, the han­dling of halal cer­ti­fi­ca­tion by gov­ern­ment will facil­i­tate more effec­tive multi­na­tion­al cooperation’s due to the rel­a­tive­ly high degree of account­abil­i­ty and trust, includ­ing mutu­al recog­ni­tion of halal cer­tifi­cates between coun­tries, thus elim­i­nat­ing the prac­tice of recer­ti­fi­ca­tion of prod­ucts from abroad, which was com­mon in the old system.

In Malaysia, while halal cer­ti­fi­ca­tion is car­ried out by pub­lic insti­tu­tions, be it on the fed­er­al or state lev­el but, unlike in Indone­sia, it remains vol­un­tary [28]. Nonethe­less, Malaysian gov­ern­ment involve­ment  in the halal cer­ti­fi­ca­tion since its incep­tion has made the coun­try high­ly respect­ed world­wide, and its halal cer­ti­fi­ca­tion is one of the best inter­na­tion­al­ly [26]. Some of the rea­son for that was inclu­sion of some eval­u­at­ing mea­sures that, while not imme­di­ate­ly halal-relat­ed, improved the qual­i­ty of the cer­ti­fied prod­uct, such as  the Haz­ard Analy­sis and Crit­i­cal Con­trol Points (HACCP) stan­dard of qual­i­ty,  and Good Man­u­fac­tur­ing Prac­tices (GMP) to enhance to the cred­i­bil­i­ty of halal food in the mar­ket, in addi­tion to Good Hygiene Prac­tices (GHP) and the Malaysian Stan­dard MS1500:2004 [1]. With­in the array of dis­perse pro­vi­sions, the enact­ment of the Trade Descrip­tion Act 2011 and two rel­e­vant sub­sidiary leg­is­la­tions, name­ly the Trade Descrip­tion (Cer­ti­fi­ca­tion and Mark­ing of Halal) Order 2011 and the Trade Descrip­tion (Def­i­n­i­tion of Halal) Order 2011, has been com­mend­able for they have been able to define more clear­ly the halal con­cept and to sit­u­ate bet­ter the rela­tions of sev­er­al halal cer­ti­fi­ca­tion bod­ies in exis­tence [28,29].

Accord­ing to the MPFMHC 2014 [30], there are three groups of pro­fes­sion­als involved in the process of halal cer­ti­fi­ca­tion, name­ly the halal audi­tors, the halal exec­u­tives, and the halal cer­ti­fi­ca­tion pan­el. The halal audi­tors, with qual­i­fi­ca­tions in either Islam­ic or food tech­nol­o­gy sci­ence, car­ry out the halal audit. The halal exec­u­tive, who must be Malaysian Mus­lim cit­i­zens and hav­ing a back­ground in Islam­ic Stud­ies or has under­gone a halal exec­u­tive train­ing, is the per­son in charge and respon­si­ble for man­ag­ing the halal cer­ti­fi­ca­tion appli­ca­tion put in by the company/​industry. The halal audi­tor, after receiv­ing an appli­ca­tion from a halal exec­u­tive of the appli­cant com­pa­ny, would review the doc­u­ments, ensure fee pay­ment, con­duct com­pli­ance audit at the premise, pre­pare the report, and sub­mit the results to the halal cer­ti­fi­ca­tion pan­el dur­ing their meet­ing for approval. When per­form­ing an onsite audit, the halal audi­tor would make the nec­es­sary report. Any non­con­for­mance must be record­ed and detailed out in a Non-Con­for­mance Report and cor­rec­tive action must then be tak­en by the halal exec­u­tive. Once the cor­rec­tive action is com­plet­ed and all require­ments are ful­filled, the halal exec­u­tive will resub­mit the com­plet­ed halal cer­ti­fi­ca­tion appli­ca­tion to the halal audi­tor. The final stage of the halal cer­ti­fi­ca­tion process is to for­ward the appli­ca­tion to the Malaysia Halal Cer­ti­fi­ca­tion Pan­el (HCP) for approval. The deci­sion made by the HCP is final and shall be record­ed and kept for future ref­er­ence. The appli­cants will then be noti­fied of the sta­tus of their appli­ca­tion [28].

In Feb­ru­ary 2006, the e‑halal sys­tem was launched to enable an online appli­ca­tion for halal cer­ti­fi­ca­tion. The pur­pose of this sys­tem was to enhance pro­duc­tiv­i­ty in the halal cer­ti­fi­ca­tion process, to give pri­or­i­ty to halal cer­ti­fi­ca­tion appli­ca­tions from the indus­try, and to also serve as a data­base of com­pa­nies, busi­ness­es, restau­rants, hotels, and prod­ucts. In April 2014, the e‑halal sys­tem was rebrand­ed as MYe­HA­LAL, which seg­re­gat­ed the halal appli­ca­tion into sev­en dif­fer­ent cat­e­gories: (i) Food and Bev­er­ages Prod­ucts; (ii) Con­sum­able Prod­ucts; (iii) Food Premis­es; (iv) Cos­met­ics and Toi­letries; (v) Phar­ma­ceu­ti­cals; (vi) Logis­tics; and (vii) Slaugh­ter­house (under the mon­i­tor­ing and super­vi­sion of JAKIM for domes­tic as well as inter­na­tion­al prod­ucts). This appli­ca­tion is acces­si­ble through JAKIM’s web­site [28].

Fig­ure 3. The Process of Halal Cer­ti­fi­ca­tion in Malaysia [30]

Challenges, Opportunities, and Comparative Advantages

There were two types of chal­lenges that halal cer­ti­fi­ca­tion process faced in Indone­sia and Malaysia. Inter­nal fac­tors were those emerged in rela­tion to employ­ers or employ­ees with­in the orga­ni­za­tion, while exter­nal fac­tors were fac­tors that came from out­side of the orga­ni­za­tion [28]. Inter­nal fac­tors, in this regard, were those relat­ed to the halal cer­ti­fy­ing insti­tu­tions, such as qual­i­ty of human resources and ser­vices, and legal infra­struc­ture. Mean­while, exter­nal fac­tors prob­lems were those faced or gen­er­at­ed by appli­cants and competitors.

Of the inter­nal fac­tors, the most fre­quent­ly men­tioned were the low com­pe­tence that the employ­ees of the cer­ti­fy­ing insti­tu­tions demon­strat­ed, par­tic­u­lar­ly in terms their job per­for­mance. For instance, lack of man­pow­er was lament­ed quite often in Malaysia, and it led to work­load, and even­tu­al­ly men­tal stress. On dif­fer­ent occa­sions, lack of man­pow­er was men­tioned to be the main rea­son for poor com­mu­ni­ca­tion between halal exec­u­tive and halal audi­tors. More­over, halal audi­tors’ incom­pe­tence and lack of skills and knowl­edge in per­form­ing their task, espe­cial­ly when asked cer­tain ques­tions by appli­cants, had dis­cour­aged entre­pre­neurs to pro­ceed fur­ther with their appli­ca­tion. Many viewed that such inca­pable audi­tors were due to dis­par­i­ty in the recruit­ment process by Fed­er­al and State gov­ern­ments in Malaysia. It became more com­pli­cat­ed with the intro­duc­tion of new schemes, such as halal cer­ti­fi­ca­tion for logis­tics and phar­ma­ceu­ti­cal indus­tries that required fur­ther learn­ing. Many believed that, if not imme­di­ate­ly addressed, this lack of com­pe­ten­cy could ruin the cred­i­bil­i­ty of the halal author­i­ty. Inter­est­ing­ly, the above issues did not apply to Indone­sia, as sug­gest­ed by some Malaysian, stat­ing that the audi­tors of Majelis Ula­ma Indone­sia (MUI) were knowl­edge­able in terms of, for instance, the cos­met­ic scheme, and were ful­ly trained. Sim­i­lar views expressed in terms of the prac­ti­cal­i­ty of online appli­ca­tion for halal cer­ti­fi­ca­tion, com­par­ing between MYe­HA­LAL Sys­tem in Malaysia and MUI’s CEROL sys­tem in Indone­sia, the lat­ter of which was deemed more reli­able. The halal exec­u­tives voiced out their dis­sat­is­fac­tion with MYe­HA­LAL sys­tem, which seems to be out­dat­ed and very unsta­ble, as they had often faced tech­ni­cal prob­lems with the sys­tem, such as its sav­ing capa­bil­i­ty and the absence of the per­son in charge. On the oth­er hand, MUI’s CEROL sys­tem was thought to be much more user friend­ly.  In addi­tion , the appli­cants in Malaysia were also required to sub­mit the appli­ca­tion man­u­al­ly, which was has­sle for the halal exec­u­tives [6,8,23,28,31].

In terms of legal infra­struc­ture, many appli­cants com­plained about the fact that Malaysian halal cer­ti­fi­ca­tion did not have “umbrel­la law”, which coor­di­nat­ed the wide array of halal pro­vi­sions. This was a con­se­quence of the fact that halal relat­ed mat­ters in Malaysia were gov­erned by dif­fer­ent enti­ties with dif­fer­ent rights, duties, and pow­ers as well as con­flict of juris­dic­tion. While JAKIM was the main body involved in halal cer­ti­fi­ca­tion and enforce­ment in Malaysia,  it was, how­ev­er, sup­port­ed by sev­er­al oth­er agen­cies, in which each agency has its own role, juris­dic­tion and leg­is­la­tion [26,28]. This issue did not occur as much in Indone­sia since halal cer­ti­fi­ca­tion was run by MUI/​BPJPH, act­ing as the supreme leader of halal assur­ance in Indone­sia in gen­er­al.  Any rela­tions and cooperation’s that MUI/​BPJPH had with oth­er agen­cies were most­ly coor­di­na­tive and con­sul­ta­tive, and the final deci­sion was with­in the author­i­ty of MUI/​BPJPH. Thus, after sub­mit­ting the appli­ca­tion, halal cer­ti­fi­ca­tion appli­cants in Indone­sia did not have to both­er with what tran­spired behind the main door of MUI/​BPJPH.   

About issues per­tain­ing to appli­cants espe­cial­ly relat­ed to inabil­i­ty to ful­fill the require­ments of halal cer­ti­fi­ca­tion there was a per­cep­tion that halal cer­ti­fi­ca­tion was mon­ey and time con­sum­ing, and com­pli­cat­ed. In addi­tion,  the lack of prop­er knowl­edge in terms halal cer­ti­fi­ca­tion process among appli­cants was equal­ly ram­pant in both coun­tries  [5,6,28]. The same can be said with respect to offences and vio­la­tion against halal cer­ti­fi­ca­tion pro­vi­sions. How­ev­er, the men­tal impact that such offences brought about among the con­sumers was arguably dif­fer­ent in the two coun­tries. Malaysian con­sumers were seem­ing­ly more affect­ed than their Indone­sian coun­ter­parts, which accord­ing­ly affect­ed how each per­ceived the halal author­i­ties and insti­tu­tions in their respec­tive coun­tries. While in Malaysia JAKIM was often blamed for any offens­es occurred in Malaysia, to an extent that con­sumers might build up some dis­trust, in Indone­sia con­sumers tend­ed to be more relaxed, and treat­ed such an offense sim­ply as an acci­dent and no rep­re­sen­ta­tive of some­thing nor­mal and per­va­sive. This may have some­thing to do with the imme­di­ate, or lack of, actions tak­en by the author­i­ties  [23,26,­28,­32,­33].

In terms of com­pe­ti­tion with oth­er for­eign halal cer­ti­fi­ca­tions, the atti­tude of Indone­sian halal author­i­ties also seemed to be more relaxed than those in Malaysia, more like­ly due to the dif­fer­ent size of domes­tic halal mar­ket in both coun­tries. The size­able domes­tic halal mar­ket in Indone­sia gen­er­at­ed some sense of secu­ri­ty among its halal author­i­ties, while in Malaysia export was so tar­get­ed, for a larg­er rev­enue, giv­en the rel­a­tive­ly small domes­tic halal mar­ket that it had. Fur­ther­more, Indone­sian halal author­i­ties were seem­ing­ly con­fi­dent about the reli­a­bil­i­ty and acces­si­bil­i­ty of its halal cer­ti­fi­ca­tion con­sid­er­ing, among many oth­er, the fact that many com­pa­nies from Malaysia applied for the halal logo from MUI, because they thought MUI pro­vid­ed prop­er guide­lines, its doc­u­men­ta­tion check­list was com­pre­hen­sive, and its halal audi­tors were com­pe­tent.  Com­par­a­tive­ly, it was prob­a­bly jus­ti­fi­able to state that Indone­sian halal cer­ti­fi­ca­tion was more acces­si­ble than the one in Malaysia, pro­vid­ed the gen­er­al per­cep­tion that the lat­ter was much stricter, which was not nec­es­sar­i­ly a bad thing, for it also required the sat­is­fac­tion of oth­er stan­dards not direct­ly halal relat­ed, but more about refined qual­i­ty of prod­ucts. Besides, Indone­sian halal logo could be used in Malaysia  [8,8]. Final­ly, self-per­cep­tion of Malaysian halal cer­ti­fi­ca­tion as the pio­neer might con­tribute some­thing to cre­at­ing a sense of being chased; mean­while, as a late com­er, Indone­sia had no such qualm and, instead, was always eager to catch up.

Regard­less, there were com­mend­able assets in Malaysian halal cer­ti­fi­ca­tion that should make Indone­sia envy, name­ly its inter­na­tion­al cam­paign through an insti­tu­tion such as HDC and its com­mit­ment to pro­duce the best, by includ­ing mea­sures that not imme­di­ate­ly halal relat­ed, such as such as the Haz­ard Analy­sis and Crit­i­cal Con­trol Points (HACCP) stan­dard of qual­i­ty, Good Man­u­fac­tur­ing Prac­tices (GMP), and Good Hygiene Prac­tices (GHP). The com­bi­na­tion these are more like­ly to be more prof­itable in the future.

Conclusions

Indone­sia and Malaysia are equal­ly Mus­lim coun­tries, but they adopt­ed two dif­fer­ent polit­i­cal arrange­ments, espe­cial­ly about Islam. The uni­tary state, Indone­sia opt­ed to appre­ci­ate uni­ty in diver­si­ty thus choos­ing a sec­u­lar ori­en­ta­tion that allowed all rec­og­nized reli­gions, includ­ing Islam, to be on an equal foot­ing with the rest, regard­less of its ascen­dan­cy. Malaysia, on the oth­er hand, chose to make Islam as its offi­cial­ly polit­i­cal garb. This polit­i­cal choice had impact­ed how halal cer­ti­fi­ca­tion was man­aged in both. In Indone­sia, on the one hand, halal cer­ti­fi­ca­tion began as a civ­il soci­ety move­ment and only much lat­er, when it had been rel­a­tive­ly solid­i­fied through MUI efforts, it start­ed to ren­der it to the gov­ern­ment. In Malaysia, on the oth­er hand, halal cer­ti­fi­ca­tion took a high, if wind­ing, road in its attempts to accom­mo­date the halal needs of Mus­lims there. There­fore, rel­a­tive­ly pro­tect­ed from the fast pace of polit­i­cal Islam of the state, halal cer­ti­fi­ca­tion in Indone­sia took a cul­tur­al approach in con­sol­i­dat­ing its halal aspi­ra­tions by build­ing a strong foun­da­tion upon which fur­ther devel­op­ment, albeit grad­ual, might launch. Malaysia, on the oth­er, pro­ceed­ed speed­i­ly to an extent that progress was more impor­tant than solid­i­ty. As a result, halal cer­ti­fi­ca­tion in Indone­sia was able to solid­i­fy by cre­at­ing moth­er law to which all oth­er halal pro­vi­sions refer. Mean­while, in Malaysia, per­haps under the influ­ence of its fed­er­al sys­tem, halal cer­ti­fi­ca­tion took a for­ward direc­tion with­out a lit­tle chance to con­sol­i­date inter­nal­ly. The absence of moth­er law on halal in Malaysia had result­ed in the fact that a range of halal pro­vi­sions that came into exis­tence were, at times, over­lap­ping and con­flict­ual with each oth­er. If the leader insti­tu­tion of halal cer­ti­fi­ca­tion in Indone­sia was supreme and the rest fol­low suit, in Malaysia the Fed­er­al gov­ern­ment and the States were sel­dom in com­pe­ti­tion with one anoth­er. Sim­i­lar­ly, while the evo­lu­tion of halal cer­ti­fi­ca­tion in Indone­sia took a lin­ear and much sim­pler route, before and after the pro­mul­ga­tion of UUJPH, its Malaysian coun­ter­part often expe­ri­enced sud­den turns, fol­low­ing the dynam­ic high pol­i­tics of the state. Even­tu­al­ly, this has impact­ed the man­age­ment of halal cer­ti­fi­ca­tion in both, includ­ing the mech­a­nism of and atti­tudes to fac­ing chal­lenges and seiz­ing the oppor­tu­ni­ties. While halal cer­ti­fi­ca­tion in Indone­sia seemed to be more reli­ably acces­si­ble, even in the eyes of many Malaysian Mus­lims, the halal cer­ti­fi­ca­tion in Malaysia, while aim­ing at the finest, in the name of a refined qual­i­ty, was often per­ceived as strict yet rid­dled with prob­lems and anxiety.

Data Availability

Most, if not all, of data here, read, stud­ied, and inter­pret­ed were avail­able and acces­si­ble online. As can be seen in the bib­li­og­ra­phy, each ref­er­ence has a link to trace. 

Conflicts of Interest

“The authors declare that there is no con­flict of inter­est regard­ing the pub­li­ca­tion of this paper. Any analy­sis and inter­pre­ta­tion pre­sent­ed there­by car­ries no prej­u­dice to any­one or any­thing, but com­plete­ly the con­se­quence of the avail­able data lead­ing to a cer­tain under­stand­ing. There­fore, any con­clu­sions made are con­testable and open to crit­i­cism and revi­sion, as evi­dence leads”.

Funding Statement

The arti­cle was based on the results of research on halal cer­ti­fi­ca­tion in Indone­sia and Malaysia in 2019, fund­ed whol­ly by the insti­tu­tion­al fund of the State Uni­ver­si­ty of Malang, Indonesia.

Acknowledgments

The authors would like to extend an appre­ci­a­tion to the Uni­ver­si­tas Negeri Malang, espe­cial­ly the Cen­ter for Research and Com­mu­ni­ty Ser­vices, in addi­tion to some per­son­nel in MUI and BPJH, JAKIM, halal audi­tors in Uni­ver­si­ti Putra Malaysia, Air­lang­ga Uni­ver­si­ty, and Braw­i­jaya University.

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Corresponding author biography

Achmad Tohe received his Ph.D. in Islam­ic Stud­ies from Boston Uni­ver­si­ty in 2015. Cur­rent­ly, he is a lec­tur­er at the Ara­bic Depart­ment, Fac­ul­ty of Let­ters, Uni­ver­si­tas Negeri Malang, Indone­sia. His research inter­est is wide-rang­ing, par­tic­u­lar­ly in the inter­sec­tion of reli­gion and cul­ture, soci­ety, pol­i­tics, and eco­nom­ics. Recent­ly, he has researched the halal indus­try, includ­ing halal tourism and halal cer­ti­fi­ca­tion in some Asian countries.

© 2021 by the authors. This is an open access arti­cle dis­trib­uted under the Cre­ative Com­mons Attri­bu­tion License, which per­mits unre­strict­ed use, dis­tri­b­u­tion, and repro­duc­tion in any medi­um, pro­vid­ed the orig­i­nal work is prop­er­ly cited.

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