Confusion over new halal certificates

Some exporters with new halal certification from the Halal Industry Development Corporation (HDC) are facing problems exporting their goods to Indonesia. The new halal certificates are not always accepted by the authorities there.

Halal certificates are important for Muslims to distinguish between permissible (halal) and prohibited (haram) food, drink, medicine and cosmetics.

To people of other faiths, the certificates signify that a product meets high safety, nutrition and quality standards.

In Malaysia, 80 percent of halal certificates are issued to food manufacturering companies which are not majority owned by Muslims, including multinational corporations. The certificates are necessary for them to sell their products to Muslim consumers.

In April last year, HDC also took over the halal certification operations from the Islamic Advancement Department (Jakim). HDC itself was established in Sept 2006 and also provides halal training, manages halal industrial parks and promotes the Malaysian halal brand.

Unfortunately, the new HDC halal certificates are now causing confusion in Indonesia. Muhammad Zein Nasution, vice-director for certification at the Indonesian Council of Ulamas (MUI) told Malaysiakini that his organisation does not recognise the new HDC certification.

MUI only recognises the old halal certificates issued by Jakim.

Contact between MUI and HDC

MUI is responsible for certifying halal products in Indonesia and Zein confirmed that there had been contact between MUI and HDC about the matter last year. But Zein added that HDC had not yet submitted an official report about its certification procedure to MUI.

Zein explained that the Indonesian halal certification procedure consists of verifying the list of ingredients, making factory visits and reviews by an audit board, before the certificate is finally granted by MUI’s fatwa council.

MUI expects a similarly rigorous procedure from HDC and it will also study the qualification of HDC’s food scientists and religious officials.

Several Malaysian exporters said that Indonesian officials were inconsistent in recognising the new HDC certificates. Malaysiakini understands that the problem arose last year soon after HDC started issuing halal certificates and was then resolved. But the issue has since resurfaced.

In 2008, exports to Indonesia accounted for approximately RM20 billion. Indonesia is the largest export market for Malaysian halal food products after Singapore.

When contacted via e-mail about the halal certificate confusion, Mariam Abdul Latif, the head of HDC’s halal integrity division said that “there is no confusion on this matter as we have officially met MUI on various occasions to introduce HDC on its roles and functions and (to inform them) that HDC (like Jakim) is wholly-owned by the government of Malaysia.”

She also said that “official notification (of the change from Jakim to HDC) has been formally issued to all diplomatic missions overseas through the Malaysian Ministry of Foreign Affairs,” in response to a question if HDC’s new halal certificates were not being recognised in other countries.

Improving the delivery system

Mariam added that HDC “has improved the certification processing time after undertaking a “Halal Certification Process Improvement” exercise. This exercise has significantly improved the delivery system without compromising syariah principles. However, the certification processes remain the same as previously practised by Jakim.”

It is not the first time that Malaysia’s halal certification system has been changed. In 1998, Jakim’s halal certification operation was privatised to Ilham Daya Sdn Bhd. But this privatisation was reversed in 2003.

The second round of halal reforms in 2006 again raised eyebrows because Prime Minister Abdullah Ahmad Badawi’s family is involved in the halal industry as well.

Abdullah’s son-in-law Khairy Jamaluddin is the former chairman of the World Halal Forum.

And according to a profile on the Asean 100 Leadership Forum website, Abdullah's daughter Nori is a co-founder of KasehDia Sdn Bhd, a leading halal business consultancy that organises the World Halal Forum every year.

In the final analysis it seems that the success of HDC’s halal certificates is a question of integrity.

Irfan Sungkar, a blogger and senior consultant at KasehDia observed in his blog that: “The problems sometimes lie not in the change, but in the consistency and stable expectation and whether the new entity can perform better than the previous entity (e.g. whether HDC is able to perform better compared to Jakim).

“This is a question regarding reforms in many developing countries - consistency, policy reversals, stability and clear expectations.”