Seeking Opportunities from Complex Regulatory Challenges for Halal Cosmetic Products in ASEAN Market
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1 Seeking Opportunities from Complex Regulatory Challenges for Halal Cosmetic Products in ASEAN Market Ahmad Shaiful Alwi b Md Nor, RPh Principal Consultant Asas Avedis Consultancy
2 BACKGROUND INFORMATION
3 Halal Certifying Bodies in ASEAN Countries Country Brunei Darussalam Certifying Body Brunei Islamic Religious Council Cambodia Not available as yet. Mandate given to the Cambodian Muslim Development Foundation to set-up the Halal Certifying Body in Cambodia. Indonesia The Assessment Institute for Foods, Drugs and Cosmetics, Indonesian Council Ulama
4 Halal Certifying Bodies in ASEAN Countries Country Malaysia Certifying Body Malaysia Department of Islamic Developmet (JAKIM) Myanmar Islamic Religious Affairs Council 183, Middle Block, Bosonpat Street, Pebedan, Rangoon, Yangon, BURMA Philippines Islamic Religious Affairs Council Islamic Dakwah Council of Philippines
5 Halal Certifying Bodies in ASEAN Countries Country Singapore Certifying Body Islamic Religious Council of Singapore (MUIS) Vietnam Halal Certification Agency Thailand The Central Islamic Committee of Thailand (CICOT)
6 Status of Halal Cosmetic Requirements in ASEAN Countries Country Brunei Cambodia Indonesia Laos Malaysia Myanmar Philippines Singapore Thailand Vietnam Halal Cosmetic Certification Guideline No No No No Yes No No No No No
7 Halal Certification Halal Requirements Halal Certification Technical & Regulatory
8 Halal: Harmonisation? Asean Working Group on Halal Food (AWG Halal) Activities have been conducted and implemented by the Working Group are registration and compilation of Halal Food additives, capacity building programme of Halal Food activities (i.e. trainings of Halal Inspectors, Halal Food Auditors, and Laboratory Analyst), implementation of ASEAN Guidelines on Halal Food for both intra- and extra-asean trade.
9 Halal: Harmonisation? ASEAN GENERAL GUIDELINES ON THE PREPARATION AND HANDLING OF HALAL FOOD Common Definitoin of Shariah Law and lawful (Halal) Food. Najs according to Shariah Sources of halal food and drinks Halal slaughtering Product Display, Storage and Serving Product Processing and Handling Hygiene and Sanitation This guideline will be implemented through an accreditation scheme operating in each Member Country.
10 ASEAN Halal Logo National Halal Logo COUNTRY NAME ACCREDITATION NUMBER OF PRODUCT
11 ASEAN MARKET: OPPORTUNITY
12 Halal Cosmetic and Personal Care Market Global Cosmetic Sales USD300 billion Global Halal Cosmetic Sales USD 13 billion Growth rate of 15% per annum. Halal preference indicator? 891 out of the total 1000 respondents did indicate that halal logo play an important role in their purchasing decision making. Increase religious adherence among Muslim globally.
13 Muslim Population In ASEAN Country Muslim Population % of Total Muslim in ASEAN Brunei 211, % Cambodia 240, % Indonesia 204,847, % Laos 1, % Malaysia 20,011, % Myanmar 1,900, % Philippines 4,737, % Singapore 721, % Thailand 3,952, % Vietnam 160, % Source: Pew Research Center report of The Future of the Global Muslim Population, as of 27 January 2011
14 Asia is the biggest halal market globally! Source:
15 Global Muslim Purchasing Power Largest Muslim Population Largest Muslim % of Total Population Indonesia Bahrain Saudi Arabia Pakistan Kuwait Turkey India Saudi Arabia Iran Bangladesh Algeria Malaysia Turkey Iran Qatar Egypt Oman Russia Iran Turkey France Nigeria Yemen Libya China Tunisia UAE Ethiopia Iraq United States Algeria Libya Algeria Morocco Pakistan Singapore Sudan UAE Indonesia Afghanistan Qatar Egypt Highest Purchasing Power of Muslim Population Iraq Egypt The Netherlands Source: AT Kearney: Addressing Muslim Market
16 ASEAN MARKET: CHALLENGES
17 Cosmetic? Harmonisation of the Technical Requirements at ASEAN level, does not include Halal. Only 1 country has issued official standard for cosmetic Malaysia. Issue: Development of various standards by the countries resulting from additional country specific requirements. Differences in preparation of documentation for certification.
18 HOW TO ENTER THE MARKET?
19 Scenario Asas Avedis Cosmetic Pvt Ltd which is based in Cambodia would like to grow organically via market expansion. What will be the best strategy for the company to avoid issues on regulatory compliance of multiple market entries?
20 Few Basic Questions Which market to enter and why? Registration of IP? Foreign exchange risk? Cost reduction & local responsiveness analysis for market entry strategy Regulatory issues?
21 Regulatory Challenges Common Regulatory Requirements ASEAN Cosmetic Good Manufacturing Practice ASEAN Cosmetic Directives Definition of cosmetic Definition of shariah Country Specific Requirements Labelling Halal Certification Procedures Others
22 Assumptions Common technical and regulatory requirements are already met: ASEAN Cosmetic Directives Including all Annexes Product Information File Good Manufacturing Practice (GMP) Labelling Requirements (including country specific requirements)
23 How to mitigate risk of noncompliance Ingredients Source only from halal certified suppliers. Certification must be from authorised halal certification bodies Documents to prove that ingredients are of halal origin: Halal Certificate Certificate of origin Active ingredients specification MSDS Letter of declaration from manufacturer
24 How to mitigate risk of noncompliance Documentation Integrate the halal documentation with the technical and regulatory requirements, wherever possible. GMP Product Information File (PIF) Halal Manual Halal Critical Points Procedures and Flowcharts ISOs
25 Localisation How to mitigate risk of noncompliance Once all are harmonised, then fulfil the specific local regulatory requirements.
26 Hedging the Risks Use the experience in market expansion to lobby the local authority to harmonise the requirements based on the internationally accepted criteria. Utilise technical and regulatory requirements to your advantage! Increase barrier to entry, reducing competition Exploit the first-mover advantage strategy
27 Thank You! Ahmad Shaiful Alwi b Md Nor Principal Consultant asalwi@asasavedis.my asalwi@gmail.com
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