Why Micro and Small Enterprises Struggle to Meet Halal Certification Obligations

The halal certification obligation is regulated in Law 33/2014 on Halal Product Assurance. This regulation governs the certification obligation, the establishment of BPJPH (Halal Product Assurance Agency), the role of LPH (Halal Inspection Agency), and the authority of MUI (Indonesian Ulema Council) in determining product halalness. The product groups required to be halal-certified along with their phased timeline are stipulated through KMA 748/2021, which was later amended by KMA 944/2024.

For micro and small enterprises, this obligation often feels burdensome. The problem is not a single issue, but several interrelated ones. The following are some of them.

Ingredients Whose Origin Is Not Always Clear

Micro and small enterprises generally purchase ingredients in small quantities, often without complete documents of origin. Yet some ingredients fall into the critical point category because their status depends on the source.

An example is glycerin or glycerol (E422). This ingredient functions as a humectant and is widely used in toothpaste, syrup medicine, cosmetics, candy, moist cakes, and food preservatives. Glycerin can come from palm oil, or it can come from pork fat. Therefore its source needs to be ascertained. The alternative is halal-certified plant-based glycerin, generally from palm oil or coconut.

Another example is taurine, an amino acid used in energy drinks and fitness supplements. Today taurine is generally synthetic, but historically it came from bovine bile. Synthetic taurine produced through chemical engineering that has been halal-certified is available as an option.

There is also shellac (E904), a glossy coating from lac insect resin used on candy, medicine or supplement pills, and fresh fruit coatings. Materially it is generally tolerated, but the process needs to be checked. The alternative is halal-certified shellac with verified solvents, or plant-based coatings such as pure carnauba wax.

The one that most often raises doubt is carmine or cochineal (E120), a natural red dye from the cochineal insect. Scholars differ in their views regarding its status, so this ingredient falls into the syubhat (doubtful) category. Plant-based red dyes such as beet, anthocyanin, or lycopene can serve as substitutes.

Limited Supplier Documents

To ascertain the source of ingredients, business operators need to trace documents from suppliers. Micro and small enterprises often buy from retailers or intermediary traders who do not provide complete information about ingredient origin and halal certificates. As a result, tracing stops midway.

This problem cannot be solved by good intentions alone. Neat ingredient recording and communication with suppliers are needed. If a supplier cannot provide information, the business operator needs to find alternative suppliers or substitute ingredients.

Limited Systems and Personnel

Kepka BPJPH 57/2021 on the Criteria for the Halal Product Assurance System serves as the main reference for implementing SJPH (Halal Product Assurance System) on the business operator's side. This document contains five criteria: commitment and responsibility, ingredients, halal product processes, products, and monitoring and evaluation. This decision was later amended by Kepka 20/2023.

These five criteria demand a documented system. In micro and small enterprises, the system is often not yet written, personnel is limited, and there is no one specifically handling halal product assurance. Drafting halal policies, ingredient registries, procedures, and internal audits is work that demands time and energy.

Regulatory Changes That Need to Be Followed

Law 6/2023 as the latest amendment to Law 33/2014 simplifies the certification process. This regulation introduces the halal declaration or self-declare scheme for micro and small enterprises, and paves the way for the Halal Product Fatwa Committee.

However, that simplification still demands understanding. Business operators need to know whether their products fall into the appropriate pathway, what needs to be prepared, and how to ensure the ingredients used are truly verified. Without this understanding, procedural simplification does not automatically resolve obstacles on the ground.

What Can Be Done

There are several steps that can be started from within the business itself.

• Record all ingredients used, including additives and process aids.
• Flag ingredients whose status depends on the source or is syubhat, such as glycerin, taurine, shellac, and carmine.
• Request written information from suppliers about ingredient origin and halal certificate status.
• Look for alternative ingredients with clear sources, such as plant-based glycerin or plant-based red dyes.
• Prepare simple documents for the five SJPH criteria, even if the business is still small.

It should be noted that the determination of halalness is the authority of the MUI Fatwa Commission or the Halal Product Fatwa Committee. Halal certificates are only issued by BPJPH. Therefore, the task of business operators is to ensure their ingredients and processes can be properly traced and documented, not to determine the halal status of their own products.

The obstacles for micro and small enterprises in halal certification generally pile up: ingredients whose origin is unclear, limited supplier documents, and systems that are not yet written. Resolving them indeed takes time. But organizing ingredients and documents from the start makes the certification process more manageable.

To help with that organization, IndoHalal.id provides an SJPH platform that enables business operators to manage halal policies, ingredient registries, critical points, internal audits, and BPJPH certification readiness in one application.