Islamic Finance Law Economics And Practice By Mahmoud A El Gamal Pdf


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Islamic banking and finance

Faith, Finance, and Economy pp Cite as. Islamic finance in its broadest sense has existed since the early years of Islam.

While Islamic finance has much to offer with regard to financial management and ethical investing, it lacks cohesive and overarching regulatory structures. The chapter argues that Islamic finance, has much to offer to global finance, but its current practice falls far short of Islamic economic and ethical ideals. UM claimed to have structured the transaction as a diminishing musharaka.

Following the registration of the transaction, one of the buyers more thoroughly studied the documents and the structure, all of which were developed and prepared by UM.

He was persistent and adamant in his position. He apparently harassed the LSUC non-stop, including showing up in person at its offices and essentially refusing to leave the premises unless it addressed the complaint. He also reportedly quoted to its members the hadith mentioned in footnote one. The LSUC responded by dispatching its chief investigation counsel and a forensic auditor to deliver the complaint notice to me personally.

The importance of faith or religion for some people when it comes to financial decisions; and. These two issues run as the central themes through the discussion in this paper.

This chapter is organized into four parts. Part I provides an overview of the origins, sources, and history of Islamic finance. Part II provides an introduction to the basic principles of Islamic finance. Part III touches upon some of the regulatory and policy concerns and issues. Part IV concludes with some observations about future prospects and recommendations.

The Islamic finance system seeks to provide banking and finance services that comply with Islamic principles. By complying with Islamic principles, the Islamic finance system aims to achieve a more equitable distribution of wealth and income, and it encourages full employment, socioeconomic justice, and stability. Islamic finance, in its broadest sense, has existed since the early years of Islam, starting with the social and economic justice teachings of the Prophet Muhammad Peace be upon him—[pbuh] , 10 as detailed in the Quran and Sunnah teachings and sayings attributed to the Prophet.

Consistent with this view, at its core many of the central teachings and beliefs in Islam, including teachings on social and economic justice, are very similar to those of other major religious traditions. Historians of early Islamic civilization have documented that banking activities similar to those performed today took place from the early days of Islamic civilization.

It was not until the mid-twentieth century that Islamic financial institutions began to reemerge, partly driven by political Islam and a renewed sense of Islamic identity.

North America, considered to have one of the most stable banking systems in the world, has also witnessed growing interest in Islamic finance. While the bank ceased operations in the United States in , it bought and leased sixty homes for American Muslims. Islamic finance is also gaining interest in Canada and is expected to increase as Canada has a large, growing, young, and observant Muslim population.

One such company, UM Financial, founded in , became one of the primary Islamic financial providers in Canada. The fact remains that there is a growing appetite for Islamic finance products even in North America. Islamic finance is differentiated from conventional finance by the fact that Islamic finance is God-centered and informed by principles of Islamic law. For most people aware of Islamic finance, the first thing that comes to mind is the prohibition of riba , which is understood by most Muslims as interest per se.

The basis for this prohibition of riba is said to be rooted in the Quran and the teachings of the Prophet Muhammad peace be upon him , the Sunnah.

Contrary to the understanding of most Muslims, the definition of riba has been contested and evolving throughout Islamic history and is often the subject of intense debate among Islamic jurists, scholars, and bankers. According to some observers, around A. Transactions or dealings that involve unnecessarily or unreasonably risky undertakings in the hopes of achieving something are also prohibited.

This prohibition also extends beyond qimar to maysir , which is broader and extends to all kinds of gambling and games of chance. Another central pillar of Islamic finance is the prohibition of excessive risk, uncertainty and deception all grouped under the heading of gharar. This of course rules out speculative trading. Another dictate is that Islamic financial institutions must not be involved in areas prohibited by Islamic law, such as alcohol, tobacco, pork, gambling, pornography, and weapons.

Some of these prohibitions, to varying degrees, are similar to those found in the socially responsible investing SRI movement within conventional banking.

Particularly, since the financial crisis of , there has been pressure within Western countries for banking to become simpler, less reliant on highly leveraged capital structures, and for a more deeply ingrained sense of ethics. The foregoing restrictions do not mean that Islamic finance is averse to business or taking calculated and reasonable risks to generate a profit. On the contrary, Islam is understood to encourage trade and the productive use of capital.

One of the fundamental conceptual shifts induced by Islamic finance is that transactions must be linked to assets using equity-based instruments and contracts as opposed to debt-based instruments.

It also means that, at least in theory, there ought to be more emphasis on social justice, fairness, and ethical concerns. Provided that it is equity-based and avoids the above prohibitions, profits can be generated through the reallocation and management of risk and reward between capital providers and users. At its simplest level conventional financing takes the form of equity or debt. Debt financing involves borrowing money and not giving up ownership or an interest in the asset or going concern.

The creditor or lender has its loan secured through a mortgage or through personal property security regimes. The debtor must, of course, invariably pay a fixed return in the form of interest, which a majority of Islamic scholars translate as riba.

Islamic-compliant products attempt to shift this paradigm toward joint-venture and limited partnership structures whereby the profit and loss are shared in agreed-upon proportions. To comply with the various rules and prohibitions, numerous investment vehicles and contracts have been developed over the years that have been approved by Islamic jurists although not all instruments and structures and their permutations or iterations are accepted by all scholars.

These include, among others, murabahah , ijarah , mudharabah , musharaka , istisna , takaful , and sukuk. The asset must remain under the ownership of the financing institution until the agreed marked-up price for the asset is fully paid by the customer.

When one factors in the use of security in the form of a mortgage versus keeping title, amortization schedules that do not match the term, terms that are less than the length required to pay off the full value, rates pegged to the market interest rate, etc.

A traditional murabahah structure is also employed quite often in the trade finance context. The financier buys the goods, paying full price on delivery, and upon receipt of the goods immediately sells it at a mark-up a single payment at a later date or pre-agreed schedule within an agreed-upon time.

Depending on the reference points used, profit calculation formula, and amortization schedule used, this murabahah could easily mirror a conventionally financed transaction with Arabic terminology substitutions.

It works slightly differently in the commodity contexts. In the commodity context, upon receipt of the murabahah financed goods, the customer will immediately sell the goods back into the market with a mark-up immediately or in a deferred transaction. The only additional requirement is that the commodity is not haram.

Murabahah finance appears to be the closest to a conventional loan and the most straight-forward to effect. Another commonly used transaction is the ijarah , where the financier buys an asset from a party to lease to another party or from the customer to then lease it back to the customer for a fixed period, after which the lessee commits to repurchase the asset.

In the Islamic context, it is arguably the second most common instrument, most often used for real property or asset financing. The asset is essentially sold to the customer at the end of the ijarah contract or in the event of default for a pre-agreed buyout price plus any accrued and unpaid rent. In some situations, the underlying asset may be split up actually or theoretically on a percentage basis to allow for a sculpted reduction in the purchase price payable or to allow for partial voluntary or involuntary payments of the purchase price during the term of the ijarah contract to mirror amortization or early repayment under a conventional term loan.

Again, Islamic jurists have differences of opinion as to what is permitted and what is not in the context of ijarah. Mudharabah refers to a profit-sharing contractual agreement between a financial institution or investor and an entrepreneur. While the financial institution provides the necessary capital rabb - ul - mal , the entrepreneur mudarib provides the operational capabilities.

In the event of a loss, the financial institution loses its capital and the entrepreneur loses his or her invested labor and other intangible contributions. All profit generated by the business is distributed between the rabb - ul - mal and the mudarib as previously agreed. Similar to the ijarah model, the agreements provide mechanisms for repayment of the original investment amount and for termination on expiry, or earlier default.

It is among the more common methods utilized to engage in project finance, real-estate purchases, letters of credit, and other investment projects. Under the diminishing musharakah model, the share or interest of the investor will be paid off periodically along with the agreed profit.

A contract of mudharabah normally presumes that the mudarib entrepreneur has not invested capital to the mudharabah. The mudarib is responsible for the management only, while all the investment comes from rabb - ul - mal.

Conversely, the musharaka is the preferred vehicle when the mudarib also wishes to invest capital into the business of mudharabah. In such cases, musharakah and mudharabah are combined together. This is typically how it is done in the real estate market. Istisna involves a funding party agreeing to produce, procure, manufacture, or construct and deliver a commodity or an asset at a predetermined future time at an agreed price to another party.

This vehicle is often used in project or real estate development financing to facilitate the advance of monies during the construction phase. In such circumstances, to facilitate a long-term financing arrangement, it is very often paired with an ijarah. On completion of the underlying asset, the istisna will be replaced by an ijarah over the completed asset.

Takaful , which is often translated as Islamic insurance, is essentially a mutual benefit society or co-operative system that aims to serve as a safety net for members in case of loss. Takaful policyholders make contributions to a mutual investment pool and agree to guarantee each other. Similar to conventional insurance, a takaful contract specifies the nature of the risk and time period of coverage.

Agreement to deliver a product or service at a time in future at an agreed price. While, at least theoretically, Islamic finance has much to offer with regard to economic and social justice, financial management, and ethics, the Islamic finance industry of today faces significant challenges, especially outside the Muslim world.

Some of these issues are germane in Muslim states, too, but they are more pronounced or unique to jurisdictions that do not have an overarching Islamic judicial or regulatory body. These challenges include the following: 1 lack of knowledge and sophistication on the part of Muslim consumers and the non-existence of uniform standards; 2 shortage of experts with an understanding of Islamic rules, finance, law, and their interactions; 3 lack of sophistication, professionalism, and the resulting lack of credibility; 4 legal impediments, regulatory confusion, and lack of oversight; and 5 politics and public opinion.

A few of these issues are highlighted below to provide an overview. Far too many consumers lack basic knowledge about finance and financial risk and may make unwise financial decisions.

They may also be easily duped by fraudsters and high-powered salespeople. This is the main reason that governments often have extensive rules and regulations when it comes to investments and financial schemes.

This is true for all money matters, but as the foregoing discussion on Islamic finance illustrates, the situation can be even more complex when there is a marriage between finance and faith.

Mahmoud Amin El-Gamal, a leading critic of the Islamic finance industry, argues that the industry is selling overpriced products to the religiously naive. Professor El-Gamal may be giving the ultraorthodox Muslims too much credit, because from my experience working with Islamic finance products, most Muslims, even the ultraorthodox, have a very limited or cursory understanding of Islamic finance in practice.

The key questions are: 1 how do we get religious consumers to be more inquisitive, and 2 how do we get them to do more due diligence: This is particularly important given that consumer protection legislation in this context is virtually non-existent or deficient. Muslim jurisdictions are not immune either. Specifically, the notion that riba , which is prohibited in Islam, is broadly equivalent to interest.

Islamic Finance and Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT)

Decock, Wim, editor. I Mapit. Available at Stacks. Add to List. I - On shelf - Show more items Added Author Decock, Wim, editor. Sagaert, Vincent, editor.

Islamic Finance Law, Economics, and Practice

These include risks to the soundness and stability of financial institutions, including Islamic finance institutions, and of financial systems, increased volatility of international capital flows, and a dampening effect on foreign direct investment. The main principle of Islamic finance, i. Other principles are: risk sharing, prohibition of excessive uncertainty and short sales, and the recognition that money does not have an inherent value in itself. Based on these principles, Islamic financial products are designed to facilitate financing according to Islamic norms. Islamic finance is a fast growing global phenomenon.

The Qur'an prohibits riba , which literally means "increase". Technically riba is the increase when liquid or fungible assets cash, debt, grains, etc. In the late 20th century, as part of the revival of Islamic identity, [4] [Note 1] a number of Islamic banks formed to apply these principles to private or semi-private commercial institutions within the Muslim community. The industry has been lauded for returning to the path of "divine guidance" in rejecting the "political and economic dominance" of the West, [4] and noted as the "most visible mark" of Islamic revivalism, [13] its most enthusiastic advocates promise "no inflation, no unemployment, no exploitation and no poverty" once it is fully implemented. Although Islamic finance contains many prohibitions—such as on consumption of alcohol, gambling, uncertainty, etc.

Banking or banking activity that complies with sharia Islamic law —known as Islamic banking and finance , or shariah [1] -compliant finance [2] —has its own products, services and contracts that differ from conventional banking. Some of these include Mudharabah profit sharing , Wadiah safekeeping , Musharakah joint venture , Murabahah cost plus finance , Ijar leasing , Hawala an international fund transfer system , Takaful Islamic insurance , and Sukuk Islamic bonds. Sharia prohibits riba , or usury , defined as interest paid on all loans of money although some Muslims dispute whether there is a consensus that interest is equivalent to riba. To be consistent with the principles of Islamic law Shariah and guided by Islamic economics, the contemporary movement of Islamic banking and finance prohibits a variety of activities:.

This book provides an overview of the practice of Islamic finance and the historical roots that define its modes of operation. The focus of the book is analytical and forward-looking.

Islamic finance products, services and contracts

Global Islamic Finance Sanusi said Islamic banking was conceived to serve as a force of mediation in circumstances where the need for bridging the deficit of infrastructure was most needed The Rise of Islamic Finance - Council on Foreign Relations One of the most promising developments in Islamic finance that has wide applications outside Muslim countries are sukuk, or Islamic bonds. Sukuk plural of sakk are Institute of Islamic Banking and Insurance - Islamic Economics Central to Islamic economics and finance is the fact that money itself has no intrinsic value. The aim of this course is to provide students with a sound knowledge of the Law of Working With Islamic Finance - Investopedia Islamic finance refers to the means by which corporations in the Muslim world, including banks and other lending institutions, raise capital in accordance with Sharia Shariah, Economics and the Progress of Islamic Finance [6] Fatawa of the Shariah Boards of Kuwait Finance House and Faisal Islamic Bank Sudan are available on their respective websites kfh. Com and IslamicFinance. Sigmund Freddyg.

 Я не электрик. Позвони в технический отдел. - В куполе нет света. - У тебя галлюцинации.

Кольцо снова блеснуло на солнце. Женщина отвернулась. Танкадо, задыхаясь и не в силах произнести ни звука, в последней отчаянной надежде посмотрел на тучного господина. Пожилой человек вдруг поднялся и куда-то побежал, видимо, вызвать скорую. Танкадо явно терял последние силы, но по-прежнему совал кольцо прямо в лицо тучному господину. Тот протянул руку, взял Танкадо за запястье, поддерживая остававшуюся на весу руку умирающего. Танкадо посмотрел вверх, на свои пальцы, на кольцо, а затем, умоляюще, - на тучного господина.


Mahmoud A. El-Gamal Islamic Finance: Law, Economics and Practice Cambridge University Press, Cambridge, New York. , pp.


Islamic Finance, Consumer Protection and Public Policy

Если бы этого не было, температура от трех миллионов работающих процессоров поднялась бы до недопустимого уровня - скорее всего силиконовые чипы воспламенились бы и расплавились. Поэтому такая перспектива даже не обсуждалась. Сьюзан старалась сохранять самообладание. Мысли ее по-прежнему возвращались к сотруднику лаборатории систем безопасности, распластавшемуся на генераторах. Она снова прошлась по кнопкам.

 У нас есть время, но только если мы поспешим, - сказал Джабба.  - Отключение вручную займет минут тридцать. Фонтейн по-прежнему смотрел на ВР, перебирая в уме остающиеся возможности.

Отключение - сложный процесс. Это была правда. Банк данных АНБ был сконструирован таким образом, чтобы никогда не оставался без электропитания - в результате случайности или злого умысла. Многоуровневая защита силовых и телефонных кабелей была спрятана глубоко под землей в стальных контейнерах, а питание от главного комплекса АНБ было дополнено многочисленными линиями электропитания, независимыми от городской системы снабжения.

Он преобразовывал послания таким образом, чтобы текст выглядел бессмыслицей. Что, разумеется, было не .

1 Comments

Marie D.
11.05.2021 at 10:15 - Reply

Faith, Finance, and Economy pp Cite as.

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