Abstract
This article discusses Shariah non-compliance risk as a form of operational risk intending to ensure that operations in the Islamic and banking finance industry comply with Shariah procedures. In the field of Islamic finance, Shariah non-compliance risk refers to the possibility that Islamic finance transactions may be challenged based on Shariah non-compliance. This article uses a comparative and normative approach as well as a legal analysis of the case of Beximco. The article proposes the management of Shariah non-compliance risk by augmenting the effectiveness of Shariah governance systems with Islamic banking and finance arbitration; arbitration should be an enforced part of Islamic finance institutional arrangements"”as it always has been classically"”to provide flexibility for dispute resolution. To this end, the article examines contemporary implementations of Shariah arbitration rules to assess how Shariah non-compliance risk can be better managed via Islamic dispute resolution procedures.
| Original language | English |
|---|---|
| Number of pages | 9 |
| Journal | Journal of Risk and Financial Management |
| Volume | 13 |
| Issue number | 1 |
| Publication status | Published - Jan 2020 |
Bibliographical note
Publisher Copyright:© 2019 by the author.
Open Access - Access Right Statement
© 2019 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (http://creativecommons.org/licenses/by/4.0/).Keywords
- dispute resolution (Islamic law)
- Islamic law
- operational risk