Indonesia to Begin Implementing the New Halal Product Assurance Law in the Second Half of the Year

Indonesia is the country with the largest Halal-consumer population in the world. With the implementation of the country's new Halal Product Assurance Law (HPA) on October 17, 2019, Indonesia is preparing to embrace tremendous change. Manufacturers are closely watching this date, because the new regulation will mandate that all food, beverages, pharmaceuticals, cosmetics, chemicals (for human consumption) and organic and genetically modified products sold in Indonesia must be Halal-certified.

As time passes, companies producing cosmetic raw materials or formulations in Indonesia have only a short time to ensure their products can comply with this new regulation. From the perspective of global regulatory affairs, companies should consider several points before this looming deadline.

Compliance requirements for cosmetics

Once the law takes effect, manufacturers must prove that the raw materials used in their products, as well as the equipment and production processes used to develop these products, comply with Halal standards.

Recognition does not guarantee compliance

Because standards and regulations differ across markets, the challenge will be ensuring that products previously Halal-certified in other countries are also accepted in Indonesia. Products with Halal certification from overseas may be recognized in Indonesia, but this recognition does not automatically guarantee that their products comply with regulations in Indonesia, and cooperation between the certification bodies of the relevant countries is required.

Well-prepared companies will gain more opportunities

Despite anxiety about the upcoming deadline, cosmetics manufacturers still have plenty of opportunities to enter this lucrative and growing market. Euromonitor predicts that by 2022, Indonesia's cosmetics and beauty products market will exceed 120 trillion rupiah. Being able to prove that their products are Halal will be key to companies breaking into the market and achieving success. Indonesia's new Halal regulation is not a threat, but it requires serious and diligent preparation.

The implementation of the new Halal Product Assurance Law (HPA) is not only a major challenge for cosmetics companies; all companies intending to sell food, beverages, pharmaceuticals, chemicals (for human consumption) and organic and genetically modified products in Indonesia should hurry to prepare fully, in order to gain more opportunities and market share.