| Aziz Idris |
ISLAMIC finance is a dynamic area of the international financial service sector, as seen in the United Kingdom (UK) with the recent introduction of various Syariah compliant products, issuance of Sukuk and the setting up of several standalone Islamic banks.
This was shared by Arshadur Rahman, an Islamic finance specialist from the Bank of England (United Kingdom), during the afternoon session of the Brunei Darussalam Islamic Investment Summit 2017 (BIIS 2017) yesterday.
The speaker was discussing his topic based on the UK’s experience with Islamic finance from a regulatory perspective.
Arshadur highlighted that the UK Government has been actively encouraging Islamic finance activities such as the harmonisation for tax treatment, promoting UK as a centre for Islamic finance, and the issuance of sovereign Sukuk in 2014, as well as coordination initiatives through a Cross-Whitehall Islamic finance working group.
From a regulatory perspective, Arshadur explained UK’s approach where it was outlined in their regulator paper issued in 2007.
“In the context of legal and regulatory framework, Islamic Finance is not regulated directly in the UK, but is covered indirectly through disclosure rules which apply to all firms,” he said.
He added that there are several general considerations in relation to Islamic finance which should be taken into account such as the distinct differentiation of Islamic financial products from conventional products.
“Islamic finance should be distinguished from charitable activity as it is primarily a commercial enterprise,” he added.
With over 10 years of experience, Arshadur also touched on the Bank of England’s Syariah compliant facilities project.
It is working to implement a Syariah compliant central bank liquidity facility to provide the UK Islamic banks with greater flexibility in meeting the liquidity requirements.
Also present during the session was Pehin Orang Kaya Seri Kerna Dato Seri Setia (Dr) Haji Awang Abu Bakar bin Haji Apong, Minister of Home Affairs in his capacity as Deputy Chairman of AMBD Board of Directors.
Among the speakers during the afternoon session was Datuk Dr Mohd Daus bin Bakar, the Founder and Group Chairman of Amanie Advisors, Malaysia, who provided his view of the Syariah and the contemporary challenges faced in finance and the implications for Brunei.
BIIS 2017 will continue today with several international and local experts exchanging knowledge and experience as well as addressing the current issues on the globalisation of Islamic finance.
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