DOING BUSINESS IN INDONESIA UNDER LAW 332014 ON

DOING BUSINESS IN INDONESIA UNDER LAW 33/2014 ON HALAL PRODUCT ASSURANCE Prof. Ir. Sukoso, M. Sc. , Ph. D. Director General of Halal Product Assurance Body (BPJPH)

History of Indonesia’s Halal • 1988, Prof. Dr. Tri Susanto, from University of Brawijaya published research, identified in food and beverages contain derivates products from pig such as gelatin, lard, emulsifier as Food Additives, 20 -30% sale product decreased. • 1989: Indonesia Ulama Council (Majelis Ulama Indonesia/MUI) solved the problem by established Institute for halal food and drugs/LPPOM-MUI). • 1989: Voluntary for Halal. • 2001: Ajinomoto Scandal. • 2014: 17 th October, Law 33/2014 for Halal Product Assurance released. • 2019: 3 th May 2019, Government Regulation Number 31 released. • 2019: 16 th Oct 2019 , Ministry of Religious Affairs Regulation 26, released. • 2019: 17 Oct, Mandatory for Halal Certification (Article 4, Law 33/2014). BADAN PENYELENGGARA JAMINAN PRODUK HALAL

INDONESIA’S CONCERN ON HALAL A. Halal 1. Constitution of Indonesia 1945, article 29 (country give the assurance for implementing the believenes to reflect the religion values) 2. Law number 33 of Halal Product Assurance, Oct 14 th 2014 by Parliament/House of Representatives. 3. Goverment Regulation 31/2019, May 3 th 2019, according the implementation of law number 33. Signed by President. 4. Ministry of Religious Affair Regulation 26/2019, 16 th October 2019, implementation of Halal. Signed by Ministry of Religious Affairs. B. Thoyyibah Indonesia National Agency of Drug and Food Control (B-POM) BPOM Decree No. 26/2017 BADAN PENYELENGGARA JAMINAN PRODUK HALAL

ABOUT INDONESIA 1. the world's largest island country, with more than 17. 000 islands. 2. more than 700 local languages with Indonesian as national languange. 3. more than 260 M peoples with 85% as Muslims. 4. Have 3 time zones, UTC +7 to +9. 5. 6 th worldwide internet users with 112 M users. Source : Processed Data (2019) BADAN PENYELENGGARA JAMINAN PRODUK HALAL

ABOUT INDONESIA 6. National economic growth 5. 5%. 7. GDP $1. 200 trillion 8. GDP Per capita $4, 460 9. 6 th the IMF market share at 2023 with 2, 8 % Source : Processed Data (2019) BADAN PENYELENGGARA JAMINAN PRODUK HALAL

BHINNEKA TUNGGAL IKA = UNITY IN DIVERSITY Pancasila is the official foundational philosophical theory of Indonesia 1. Belief in the Almighty God. 2. A just and civilized humanity. 3. A unified Indonesia. 4. Democracy led by the wisdom in a consensus or representatives. 5. Social justice for all Indonesians. BADAN PENYELENGGARA JAMINAN PRODUK HALAL

THE HALAL PRODUCT ASSURANCE BODY (BPJPH) • BPJPH under the Ministry of Religious Affair • Officially launched on 11 th of October 2017. • The establishment BPJPH base on Law 33/2014, Presidential Regulation 83/2015, and Ministry of Religious Affairs Regulation 42/2016) BADAN PENYELENGGARA JAMINAN PRODUK HALAL

MINISTRY OF RELIGIOUS AFFAIRS REPUBLIC OF INDONESIA ORGANIZATION STRUCTURE MINISTRY OF RELIGIOUS AFFAIRS REPUBLIC OF INDONESIA Halal Product Assurance Body (GENERAL DIRECTOR) Secretary Department (SECRETARY) Directorate General of Islamic Education Directorate General of Islamic Community Guidance Echelon 2 Registration and Certification (DIRECTOR) Guidance and Supervision (DIRECTOR) Cooperation and Standard (DIRECTOR) BADAN PENYELENGGARA JAMINAN PRODUK HALAL etc. Echelon 2

General Director of HAPAS-B ( Prof. Ir. SUKOSO. M. Sc. Ph. D ) Ministry of Religious Affairs (MORA) Number 42, Year 2016, Concerning Organization Structure of HAPAS-B Secretary Department (SECRETARY) Registration and Certification (DIRECTOR) Guidance and Supervision (DIRECTOR) Cooperation and Standard (DIRECTOR) Planning and IT Registration Guidance for Auditor and Stakeholder Cooperation Financial Certification Supervision Product Standard Organization, Staffing, and Law Verification Note: HAPAS-B in managing the finance uses Finance Management of Public Service Agency (BLU) (Law 33 / 2014 Article 45) BADAN PENYELENGGARA JAMINAN PRODUK HALAL

HALAL PRODUCT ASSURANCE (LAW 33/2014) • Article 1 Product are goods and/or services that are related to food, beverage, drug, cosmetic, chemicals product, biological product, genetically engineered product, as well as consumer good that are worn, used, or utilized by the public. • Article 4 Products that enter, circulate, and are traded in the territory of Indonesia must be halal certified. • Article 26 1. Business Operators that produce Product from Material that comes from haram Material as intended in Article 18 and Article 20 are excluded from submitting Halal Certificate application. 2. Business Operators as intended in paragraph (1) must attach non-halal information on the product. BADAN PENYELENGGARA JAMINAN PRODUK HALAL

PROVISION (LAW 33/2014 ARTICLE 1) Definition: • Product are goods and/or services that are related to food, beverage, drug, cosmetic, chemicals product, biological product, genetically engineered product, as well as consumer good that are worn, used, or utilized by the public. • Halal product is the product that has been declared halal lawful according to Islamic shariah. • Halal Product Process (HPP) is a series of activity to assure the halalness of the product including material procurement, process, storage, package, distribution, sales and presentation of the product • Material is Ingredients used to produce or manufacture the product. BADAN PENYELENGGARA JAMINAN PRODUK HALAL

GOODS AND SERVICES Product is goods and/or services (Article 1 verse 2, Gov. Regulation 31/2019) • Goods : food, beverage, medicine, cosmetic, chemical product, produk biological product, genetical engineering product, and usefull goods that be used or be functioned by people. (Article 1 verse 2, Gov. Regulation 31/2019) • Services : Business that be related to goods and their chain. (slaughtering, processing, storing, packaging, distributing, sale, and serving). (Article 68 verse 3, Gov. Regulation 31/2019) BADAN PENYELENGGARA JAMINAN PRODUK HALAL

BPJPH’S AUTHORITY (LAW 33/2014 ARTICLE 6) • • • Make and legitimate the Halal Product Assurance (HPA) policy. Legitimate the norms, standard, procedure, and criteria of HPA. Issue and revoke halal certificate and halal label on product. Registration the foreign product halal certificate. Socialize, educate, and announce the Halal Product. Make an accreditation at Halal Inspection Agency (HIA). Registration the Halal Auditor. Controlling the HPA. Developing the Halal Auditor. Cooperate with domestic and foreign institutions about HPA. BADAN PENYELENGGARA JAMINAN PRODUK HALAL

THE NEW ERA OF HALAL CERTIFICATION PROCESS PRODUCER Manufacture BPJPH MUI Halal Inspection Agency (HIA) can be performed by Government Institutions, University or Islamic NGO HIA / LPH Halal certification uses Traceability system and not "End Product Analysis. " BADAN PENYELENGGARA JAMINAN PRODUK HALAL

THE STEP OF HALAL MANDATORY • The halal mandatory started at 17 th of October 2019 with 5 years guidance period until 17 th of October 2024. • Food and beverages must be halal certified after 5 years the halal mandatory started 17 th of October 2019. • Except food and beverages product, the halal mandatory started at 17 th of October 2021 with guidance period various years (7, 10, 15 years). BADAN PENYELENGGARA JAMINAN PRODUK HALAL

INDONESIA’S HALAL SERTIFICATION FLOW Application Businessmen Apply for halal certification Verification BPJPH Documents verification (max 10 working days) Applicant completing the missing document (max 5 working days) Confirmation Examination BPJPH HIA Confirmation the HIA which the applicant chosen (Max 5 working days) The HIA do examination and / also testing the product. (40/ 60 working days). Checking Fatwa MUI BPJPH Checking and verification the documents from HIA (5 working days) Organize halal fatwa and issuing the halal decree BADAN PENYELENGGARA JAMINAN PRODUK HALAL Issuing BPJPH Issuing the halal certificate based on the halal decree by MUI

INDONESIA’S HALAL CERTIFICATE The certificate issued by BPJPH based on Article 42 paragraph 1 of Law 33/2014 with 4 (four) years validity. BADAN PENYELENGGARA JAMINAN PRODUK HALAL

INDONESIA’S HALAL LABEL • BPJPH have authorithy to establish the halal label based on Article 37 Law 33/2014. • Indonesia’s halal label has been patented by Ministry of Law and Human Rights. BADAN PENYELENGGARA JAMINAN PRODUK HALAL

THE STEP OF HALAL MANDATORY BASED ON MINISTRY OF RELIGIOUS AFFAIRS REGULATION 26/2019 Started 17 Oct 2019 FOOD AND BEVERAGES NON FOOD AND BEVERAGES Started 17 Oct 2021 PRODUCT NON MEDICINE, NON BIOLOGICAL PRODUCT, NON MEDICAL DEVICES & NON HOUSEHOLD HEALTH SUPPLIES MEDICINE 5 YEARS (until 17 Oct 2024) 7 YEARS (until 17 Oct 2026) TRADITIONAL MEDICINE 7 YEARS (until 17 Oct 2026) DIETARY SUPPLEMENT 7 YEARS (until 17 Oct 2026) OVER THE COUNTER DRUG AND LIMITED FREE MEDICINE 10 YEARS (until 17 Oct 2029) PRESCRIPTION DRUG EXCEPTING PSCYCHOTROPIC DRUG 15 YEARS (until 17 Oct 2034) BIOLOGICAL PRODUCT (INCLUDING VACCINE) MEDICAL DEVICES REGULATED AT PRESIDENTIAL REGULATION GRADE A RISK 7 YEARS (until 17 Oct 2026) GRADE B RISK 10 YEARS (until 17 Oct 2029) GRADE C RISK 15 YEARS (until 17 Oct 2034) GRADE D RISK REGULATED AT PRESIDENTIAL REGULATION HOUSEHOLD HEALTH SUPPLIES BADAN PENYELENGGARA JAMINAN PRODUK HALAL 7 YEARS (until 17 Oct 2026)

INTERNATIONAL COOPERATION • International cooperation of BPJPH with Halal Certification Body (HCB) basically based on Government to Government (G to G cooperation) • The government can make international cooperation for Halal in accordance with the law (Law 33/2014 Article 46 verse 1). • Halal Certificate recognition be in the form of the cooperation to recognize Halal Certificate (Gov. Regulation 31/2019 Article 26 verse 3), who do by the foreign halal agencies authorized to issue Halal Certificate (Gov. Regulation 31/2019 Article 26 verse 4). • Foreign HCB who are publishing Halal certificate established by the government or Islamic religious institutions recognized by the local government (Gov. Regulation 31/2019 Article 27). BADAN PENYELENGGARA JAMINAN PRODUK HALAL

TYPE OF INTERNATIONAL COOPERATION 3 1 People to People 2 Business to Business Government to Government Business to Business BADAN PENYELENGGARA JAMINAN PRODUK HALAL

THE FLOW OF INTERNATIONAL COOPERATION • HCB (Halal Certification Body) send the letter to BPJPH (The format from BPJPH) • BPJPH responded by asking the requirement documents. • BPJPH accepted → Verification the documents. • The notification will be given by BPJPH if the documents is not complete. • BPJPH will send the completion letter to HCB and the embassy. • The embassy preparing Mo. U Goverment to Goverment (G To G) Cooperation • Next step is Mutual Recognizing Agreement BADAN PENYELENGGARA JAMINAN PRODUK HALAL

STANDARDS 1. International Standard 2. Indonesia Standard (SNI) • Halal Management Standard (SNI 99001: 2016) • Halal Poultry Slaugther (SNI 99002: 2016) • Halal Ruminance Slaughter (SNI 99003: 2018) BADAN PENYELENGGARA JAMINAN PRODUK HALAL

HALAL GLOBAL INDUSTRY BIG 15 RANK (GIE INDICATOR 2019/20) 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. Malaysia UAE Bahrain Saudi Arabia Indonesia Oman Jordan Pakistan Kuwait Qatar Brunei Sudan Turkey Iran Bangladesh 111 79 60 50, 2 49 48, 7 47, 2 45 45 44 40 39 36 35 33 Indonesia move up 5 (five) rank from the previous year TOP 10 HALAL FOOD TOP 10 ISLAMIC FINANCE 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. UAE Malaysia Brazil Australia Sudan Pakistan Oman Brunei Turkey Iran 1. 2. 3. 4. 5. UAE Malaysia Qatar Lebanon Bahrain 6. 7. 8. 9. 10. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Malaysia Bahrain UAE Saudi Arabia Indonesia Jordan Oman Kuwait Pakistan Qatar TOP 10 HALAL MEDIA & RECREATION Brunei Singapore UK Kuwait Azerbaijan TOP 10 HALAL TOURISM Malaysia UAE Turkey Indonesia Maldives Tunisia Azerbaijan Jordan Albania Thailand TOP 10 MODEST FASHION 1. UAE 2. Turkey 3. Indonesia 4. Malaysia 5. Singapore 6. Italy 7. Bangladesh 8. Morocco 9. India 10. Sri Lanka TOP 10 HALAL COSMETICS & PHARMACEUTICALS 1. 2. 3. 4. 5. UAE Malaysia Jordan Singapore Egypt Source : Global State Islamic Economy, 2019 -20 BADAN PENYELENGGARA JAMINAN PRODUK HALAL 6. 7. 8. 9. 10. Iran Bahrain Brunei Turkey Azerbaijan

INDONESIA TOURISM BADAN PENYELENGGARA JAMINAN PRODUK HALAL

INDONESIA TOURISM BADAN PENYELENGGARA JAMINAN PRODUK HALAL

THANK YOU BADAN PENYELENGGARA JAMINAN PRODUK HALAL Halal Indonesia For World Community