International Conference on Business, Finance and Tourism Management 1 Antecedents and Outcomes of Non- Compliance to Halal among Hoteliers in Malaysia: A Down Side of Halal Tourism Suhaiza Zailani & Azizah Omar School Of Management, Universiti Sains Malaysia 11800 Penang, Malaysia Tel: (604) 6577888 ext 3952 Fax: (604) 6577448 Email: shmz@usm.my Abstract Performance of the hotel industry is very significant contribution towards economic growth of the tourism sector. The preparations of Halal food and hygienic accommodations will give an added competitiveness advantage to the hotels in attracting the local and foreign tourists especially those from the Middle East, West Asia and other Islamic countries. Muslim tourists, particularly from West Asia are increasingly sensitive and wanted access to more sophisticated holiday destinations and Halal dining. Nevertheless, statistics from JAKIM has shown that only 101 hotels all around Malaysia have applied and secured the Halal certificate from JAKIM, MAIN, and JAIN, while the rest still not doing so. It is therefore will be important to understand the reasons why most of the hoteliers are non-compliance to halal. With regards to Halal compliance, most research has focused on manufacturing aspects, that is, on the antecedents and consequences (outcomes). It is believed that there is minimal empirical work with emphasis on the antecedents and consequences (outcomes) of non- compliance to halal among hoteliers’ services. Could variables such as attitude, subjective norms, perceived behavioral control and demographics play a role in causing non-compliance to halal? Does non- compliance to halal affect hotels’ performance? This study is therefore to answer these questions. Key words: Halal compliance, hoteliers, halal tourism, Malaysia 1.0 INTRODUCTION Jafari (2007) defined tourism as activity of people traveling away from their home community to engage in one or more of a variety of activities. He added that “man away from his usual habitat, the industry which responds to his needs, and the impacts that both he and the industry have on the host socio-cultural, economic, and physical environments.” From another perspective, tourism is defined as a dynamic, evolving, customer- driven force. It is a science and a business, attracting and transporting visitors, accommodating them, and graciously catering to their needs and wants (Walker, 1996). “Tourism comprises the activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes” (World Tourism Organization (WTO) - Recommendations on Tourism Statistics). On the other hand, Kandampully (2000) defined tourism as a unique product in that it is composite in nature, an amalgam of the tangible and intangible that includes everything those tourists experience. He added that tourism is no longer considered a luxury confined to economically developed countries as it has now become an integral component of lifestyle, and it has become a major component of the economy of almost all countries. Due to that reasons, tourism has the following characteristics: movement, multi-purpose, exchange of money, its local – it’s global, it’s a massive growing industry, may be a compelling motive form some, may promote peace and understanding and the industry is fragmented (Kandampully, 2000). Tourism’s industry can impact on community through energy use (water & power), urban revitalization, environmental quality, economic growth, trade deficits (cars for tourists), full employment and quality of life. 1.1 Hotel and Tourism Industry The Malaysian Tourism Promotion Board or Tourism Malaysia has a mission statement which says: “Marketing Malaysia as a destination of excellence and to make the tourism industry a major contribution to the socio-economic of the nation” (Internet accessed on Feb. 2005: Tourism Malaysia). Malaysian tourism industry is one of the key potential growths in Malaysian services economy. The industry has contributed a significant growth and economic value to the GDP of Malaysia. Malaysian economic report 2004 by the Treasury under Ministry of Finance reported that the service sector contribution to GDP is projected at RM149, 680 million for 2005 compared to 2004 at RM141, 534 million in 2004, increases of 5.8%. The