Halal Cosmetics Market Rapid Growth Requires Further Regulatory Development

Definition of HALAL

In Islamic countries Halal means "permissible and acceptable". In the cosmetic sector, Halal implies two things:

• Firstly, the ingredients used in the product are all from natural (original) sources;

• Secondly, the product won't cause any adverse effects when applied to human skin.

The opposite of "Halal" is "Haram" a word which refers to something that is not permitted. In Halal products "Haram" ingredients are totally prohibited. For example, all ingredients derived from pigs are considered Haram.

The growing halal market and its prospects

The Halal cosmetic market occupies 11% of the Halal market (with 61% for food, 26% for pharmaceutical and 2% for other products).

The Halal cosmetic market grew to $56 billion dollars in 2015 and is expected to reach $81 billion by 2021. In US, it is estimated that the Halal cosmetic market will reach $52 billion by the year 2025. Growth in this market is also influenced by non-Muslims who prefer the natural ingredients used in Halal cosmetics.

Halal cosmetics consumers include:

Millennial Muslims

The millennials (generation M) are a group of affluent consumers who are a huge driving force in the cosmetic industry. Muslim millennials are looking for good quality Halal lifestyle products as well as keeping with the mainstream trends. Major mainstream retailers now provide halal cosmetics lines so the Muslim millennial can shop in ordinary retail stores.

Mainstream consumers

The statistic shows that 35% of halal cosmetics are purchased by non-Muslim women and the figure is expected to increase. Halal products appeal to a significant percentage of mainstream consumers seeking ethnical, vegan and vegetarian products which require the ingredients to be 100% natural. Halal cosmetics tend to use a diverse range of natural ingredients which most of which are non-animal derived.

The increasing importance of Halal certification

The growing Halal cosmetic market requires the improvement of halal certification to reassure consumers. Indonesia officially declared that by 2019, all halal consumer products should be Halal certified. While the Halal certification is a relatively new invention, Muslim countries are now investing heavily in developing halal standards for the cosmetic industry. The development of traceability and block chain technologies will provide important tools to realize a strong Halal certification system.

Currently, halal certification is not a mandatory requirement even for products targeting Muslim consumers, but only certified halal cosmetics can claim they are Halal cosmetics. The Halal certification registration system in Indonesia is an excellent case study and includes the following procedures:

The Indonesian Halal Certification System

1. Halal Assurance System (HAS)

Before applying for halal certification, the enterprises should first receive Halal Assurance System (HAS) training and implement HAS (see more on Chemlinked Expert Article).

2. Halal Certification Documentation

After the enterprises complies with HAS, they can prepare necessary documents for certification which include:

3. Apply and Register Online

When all the dossiers are ready, the applicant should upload all the data online through Cerol system (www.e-lppommui.org).

4. Monitor Pre-audit 

After uploading certification data, enterprises must conduct pre-audit monitoring. Pre-audit monitoring is recommended to be conducted every day to uncover any discrepancies.

5. Sign and Pay for the Certification Contract

Then enterprises download the certification contract from Cerol system and sign it. Pay the cost in Cerol system and wait for the approval by the Treasurer of LPPOM MUI (Indonesia competitive authority).

6. Perform the Formal Audit

Audits can be performed if the enterprise has already passed the pre-audit process and the contract has also been approved. Audits are conducted at all facilities related with products to be certified.

7. Monitor Post-audit

The enterprise needs to conduct a post-audit as well and which is also recommended to be performed every day in case of any discrepancies. If any discrepancy is found, it must be corrected properly.

8. Receiving Halal Certificate

When LPPOM MUI approves the application, the enterprise can download the halal certification in softcopy form/file in Cerol or ask for hardcopy from the office of LPPOM MUI Jakarta. The halal certification is valid for 2 years.

For more Halal certificate registration information, you may visit expert article.