IslamicFinance.de

A significant number of family offices (FOs) of wealthy Middle Eastern patriarchs are looking for suitable investment opportunities while fund managers are seeking to raise capital from this potentially lucrative market. A number of FOs (both Muslim and non-Muslim) have been instructed by their clients to allocate money to investment funds which generally bode well within the context of Shariah principles. Middle Eastern FOs or other direct investors also increasingly demand quality and timely service provision. Therefore, many FOs are interested in Guernsey as a place to allocate investments. On the other hand, the attraction of Guernsey for the fund managers is that it can provide a European platform which is not actually in the EU and therefore can offer flexibility and proportionality.

The Association of the Luxembourg Fund Industry (ALFI) has made its collection of best practices for setting-up and servicing Islamic funds public. Thus, a higher level of understanding and consistency of the requirements and expectations to this developing market sector can be ensured. This year several new Shariah-compliant funds were launched, making 2012 a busy year for the Luxembourg Islamic finance community. Luxembourg currently has 41 funds with EUR4bn in assets under management reaching the fifth place worldwide and the first in Europe in terms of number of Shariah-compliant domiciled funds.