MODERATING ROLE OF LENGTH OF BUSINESS IN LEGAL AWARENESS TOWARDS REGISTRATION OF HALAL CERTIFICATION IN INDONESIA

Hartomi Maulana, Sultan Nanta Setia Dien Labolo, Mulyono Jamal, Syamsuri Syamsuri

Abstract


The legal regulations for MSEs in Indonesia to carry out halal certification obligations are contained in PP No. 39 of 2021 concerning the Implementation of the Halal Product Guarantee Field. In the provisions of Article 139 verse (1), it is stated that the obligation to carry out halal certification begins on "food, beverage and slaughter products, as well as slaughter services starting on October 17, 2019, and lasting until October 17, 2024." Based on statistical data, the number of MSEs in Indonesia reached 64.2 million business actors as of February 2023, with the food and beverage industry sector as the largest MSE sector, which amounted to 30.9% of the total MSEs. However, the interest of MSEs in Indonesia in carrying out halal certification is still very low. This can be seen from the very small number of MSE actors who have carried out halal certification in Indonesia, which is only around 20% of the total MSE actors in Indonesia. So, this study aims to measure the level of legal awareness of Micro and Small Enterprises in Indonesia. This study uses Structural Equation Modeling (SEM) with a quantitative approach to measure the effect of legal awareness on awareness of halal certification obligations on 333 MSE actor respondents with length of business as a mediator variable. This study concludes that the constructs of legal knowledge, legal understanding, legal attitudes, and legal behavior do not have a significant positive effect on awareness of halal certification ownership among Micro and Small Enterprises (MSEs) in Indonesia. However, length of business has a significant positive impact, and moderation of length of business on the relationship between legal understanding and awareness of ownership of halal certification shows a significant positive impact. The limitations were the small localized sample and reliance on quantitative self-reported data. Further qualitative research could provide richer insights into MSE decision-making processes regarding halal certification. The study contributes empirical evidence to guide policymaking and practical strategies to improve certification rates among Indonesian MSEs.


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