Legal documentation of Islamic financing contracts /
One of the many unaddressed or unsatisfactorily addressed legal issues accompanying the rapid widespread of Islamic finance is that of the legal documentation of Islamic financing contracts. Islamic legal documentation must satisfy certain requirements: the validity of the document according to Isla...
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| Main Author: | |
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| Format: | Thesis |
| Language: | English |
| Published: |
Gombak, Selangor :
Ahmad Ibrahim Kulliyyah of Laws, International Islamic University Malaysia,
2008
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| Subjects: | |
| Online Access: | http://studentrepo.iium.edu.my/handle/123456789/1656 |
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| Summary: | One of the many unaddressed or unsatisfactorily addressed legal issues accompanying the rapid widespread of Islamic finance is that of the legal documentation of Islamic financing contracts. Islamic legal documentation must satisfy certain requirements: the validity of the document according to Islamic law, the compliance of the document with civil law (the various laws applicable to it), and the construction of the document in such a manner that it can be enforced in the civil courts. Thus, the main objective of this research is to identify the requirements of legal documentation of Islamic financing contracts, the terminology that ought to be used, and to highlight the basic factors and elements of legal interpretation of the Islamic financing contracts. Hence, the thesis discusses the legal documentation of three Islamic financing contracts, namely murabahah, BBA and ijarah, and includes discussions of the principles of contract documentation in Islamic and positive laws, the three Islamic financing contracts in terms of their nature, their various conditions, elements and clauses, their legal documentation as conducted in practice, and the interpretation of these contracts by the judiciary. It is the main hypothesis of the research that the terminology of Islamic financing contracts, the terms, conditions and clauses that are included in the legal documentation of such contracts are not compatible with the nature of these contracts or the Shari'ah rules and principles of contract formation and documentation. The research is limited to the legal documentation of these Islamic financing contracts, as practiced by some Islamic financial institutions in Jordan and Malaysia, whereas their economic importance and financial evaluation, or their suitability as financing contracts is not discussed in any detail. The research is mainly conducted following the descriptive, analytical and comparative approaches. From the findings of the research, and the analysis of the sample documents, it is concluded that the legal documentation of the murabahah and ijarah contracts, in both Jordan and Malaysia, does adhere to the specific rules and conditions regulating the said contracts. Yet, it appears that the Islamic banks, in both contracts, have shifted most, if not all, of the risks and liabilities to the customers, rendering the financing procedures practically risk-free. However, as far as BBA is concerned, the documentation thereof renders the contracts therein to be void according to the conditions provided by the jurists who permitted the said transaction. This is supported by the misconception by the courts as to the true nature of the transaction, even after the application of the correct methodology for the interpretation of contracts. Based on these findings, the researcher recommends that the documentation of Islamic financing contracts be reviewed as to be in line with the Islamic conditions that regulate them, in both letter and spirit. |
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| Item Description: | "A thesis submitted in fulfilment of the requirement for the degree of Ph.D in Law"--On t. p. Abstract in English and Arabic |
| Physical Description: | xv, 387 leaves ; 30 cm. Also available on 4 3/4 in computer optical disc. |
| Bibliography: | Includes bibliographical references (leaves 315-325). |