Halal Regulation in Asia and its Impact on Food

March 2018

The halal market remains under scrutiny across industries. Questions emerge on certification and regulatory environments, especially within Asia Pacific, where notable accreditation bodies are based and differ from one another. This report dives into these details and developments and the prominence of halal as an ethical label. These are important for potential players to consider when aiming to achieve a holistic ethical positioning.

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Asia Pacific is the biggest region for halal-certified packaged food and drink

Due to the cultural and religious mix across Asia Pacific, and the presence of strong accreditation bodies, the region’s halal segment is a relatively stable and lucrative market. China is among the highest-ranked in value sales despite having a Muslim minority population.

Despite key halal accreditation bodies in several Asia Pacific countries, a regional or global unified standard is unlikely

Looking ahead, guidelines will remain largely separate and may vary in certain aspects across markets. Businesses that plan for multiple market entry may need to verify halal compliance with different organisations.

Halal certification is rigorous, causing alternative halal compliance to emerge for businesses

The halal regulatory environment within markets faces challenges by businesses claiming to be “Muslim-owned”, those that claim the exclusion of prohibited ingredients, and the presence of non-accredited logos.

Despite Asia Pacific’s large market size and well-known certifying bodies, developments are still expected

Pakistan, Indonesia, China and the Philippines are key markets to learn from as they have varying challenges and government strategies, in addition to being in different stages of stability for halal regulation.

To assure consumers beyond technical requirements, companies should aim to achieve a holistic ethical labelling

Beyond certification, consumers also value products containing ingredients that are ethical by nature, and scrutinise packaging more closely. Even though halal labelling is set to show the strongest growth, ethical positioning is also imperative.

Scope
Key findings
Halal expected to be the leading type of ethical labelling globally
Asia Pacific holds largest stake of halal-labelled packaged food
Halal labelling not necessarily correlated with size of Muslim population
Indonesia: revamping its already established halal authority
China: Packaged food leaders gain competitive advantage with halal
Pakistan: muslim -majority, but weak regulation
Philippines: more accreditors to spur halal economy
Halal certification requires rigorous series of inspections
Halal infrastructure is more efficient with a unified standard
Efficiency in achieving halal certification is essential for FMCG
Alternatives to halal certification emerge, creating complications
Smaller, local companies may leverage on being Muslim-owned
Displaying halal compliance by excluding prohibited ingredients
Non-accredited halal logos by syndicates or individual companies
Demand for halal is a double-edged sword
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