APPROACHES TO THE LEGAL REGULATION OF SUKUK. A COMPARATIVE ANALYSIS OF THE LEGAL REGULATION OF SUKUK ISSUANCE IN INDONESIA, MALAYSIA, AND THE UNITED KINGDOM
Keywords:
Islamic finance, Islamic bank, sukuk, musharakah, mudarabah, bonds, Islamic financial services, trust investment certificates, derivatives, securitizationAbstract
The Sukuk structure is very similar to bonds among financial securities. Many jurisdictions have chosen to apply the rules used for bonds to Sukuk as the most appropriate legal solution to allow the issuance of Sukuk. However, proper legal and regulatory standards are essential to distinguish Sukuk from bonds. This article aims to compare the legal and regulatory frameworks established for the issuance of Sukuk in various countries and to study the main rules that facilitate Sukuk issuance. The article is based on a comparative approach that analyzes the legal and regulatory approaches that support Sukuk issuance in certain countries. Some of the information mentioned in this article has been gathered from relevant laws and regulations of countries like Indonesia, Malaysia, and the United Kingdom, as well as from legal literature and academic articles. The research results show that Sukuk regulation can be implemented in two ways: first, by enacting a separate law, and second, by making amendments to the existing legislation. International experience shows that, in cases where regulating Sukuk at the same level as traditional bonds is necessary to permit its issuance, it is essential to refer to pre-developed and applicable models. This provides best practices for implementing the regulatory framework of Sukuk by some jurisdictions, helping to strengthen local regulations and enhance the position of Sukuk in the market.
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