WhaTech

The dispute resolution conundrum of the islamic finance industry

The International Islamic Banking and Finance Law Conference took place in Kuala Lumpur, Malaysia, February 4-5, 2015. The conference hosted many high profile speakers including the CEO of CIMB Islamic Bank, Badlisyah Abdul Ghani, who stressed the point that everyone now working in Islamic finance should make a strong effort to learn or further develop their skills in Shari’ah. Camille Paldi, FAAIF CEO, noted that it is imperative for the Islamic Finance industry to develop a unique dispute resolution system tailored for Islamic finance. In addition, Paldi suggests that it might be wise to form a global Islamic finance bankruptcy court to handle the world’s sukuk defaults.

Islamic Finance has a Huge Potential in North America

Islamic finance, banking, and takaful has a large potential in the US and Canada despite several setbacks and various obstacles and hurdles. In terms of the United States, a 100% truly Shariáh compliant takaful company may not be possible at this time in the USA as many states have limited investment of collected premiums to non-Shariáh compliant investment grade rated bonds. However, the US has seen two major sukuk issuances and there is a large potential for further sukuk. In terms of Canada, there have been no sukuk issuances and there are no Islamic banks. The only positive ruling for Islamic finance in Canada thus far has been the permission of Islamic mortgages under Canadian law. Aside from constitutional hurdles and the lack of regulations and laws, which permit Islamic banking in North America, many people have a fear of Islam and the words Shariáh and Islamic.

Syndicate content