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Shari'ah, Law, Islamic Finance and Muslim News
Monthly Archives: April 2009
April 24, 2009
DR. ZULKIFLI HASAN
UK Budget 2009 Removes Tax Hurdles for Islamic debt
By Cecilia Valente (Available at:
http://uk.reuters.com/article/businessNews/idUKTRE53L41A20090422?sp=true
)
LONDON (Reuters) – The government will change its current tax regime to facilitate Islamic-debt issuance and encourage the growth of London as an Islamic finance hub, the government said on Wednesday. The budget 2009 report envisaged changes to the stamp duty land tax, provision of relief from tax on capital gains and capital allowance rules to remove fiscal penalties to UK companies willing to issue sukuks, or Islamic bonds.
The treasury said in the budget report that the three measures were part of the “ongoing drive to promote the UK as a centre for Islamic finance.” The changes will come into effect by the end of the third quarter and end a regime which would have double-taxed the transactions needed to set up a sukuk. A sukuk, unlike a mainstream bond, is not based on interest payments. Investors instead receive returns achieved on the underlying asset made available by the debt issuer. The global sukuk market thrived in 2007 but has since stalled. It is expected to recover partially this year. The UK has already made the most significant changes to accommodate Islamic finance in Europe and hosts five Islamic banks and one insurer. France is mounting a challenge though and plans to launch the continent’s first corporate sukuk this year.
ENCOURAGEMENT
The UK hosts sukuk listings but is yet to issue them, mainly because of the tax hurdles, said Norton Rose lawyers Davide Barzilai and Angela Savin. They said the changes are expected to encourage UK corporates to use sukuk to tap new investors. “We have been waiting and lobbying for these (changes). Now it is down to commercial forces, hopefully the economy is in a sufficient state to attract this sort of product,” Barzilai said. “It is an excellent move by the government. The relief they are introducing should mean that from a tax perspective issuing sukuk based on real estate is completely viable,” Savin said. Savin and Barzilai said a sukuk issuance could follow this year as a consequence of the new development.
The most likely sukuk form would be one based on a buy and lease-back structure that allows an issuer to sell an asset, such as a building, to a special purpose vehicle (SPV), leasing the property for the maturity of the bond and buying it back. Because under this structure a property changes hands, the company issuing sukuks has been liable to tax when it sells the property and when it buys it back. “It is a taxable sale and if you have made a gain, that is a also a taxable gain,” said Mohammed Amin, partner and Islamic finance head at PricewaterhouseCoopers. “These (tax changes) are very important because it has not been practical for a UK company to issue sukuk and it will be made possible,” he said.
Best Regards

ZULKIFLI HASAN

DUBAI, UAE
Burj Arab, Dubai, UAE
Islamic finance news
1 Comment
April 21, 2009
DR. ZULKIFLI HASAN
Universiti Sains Islam Malaysia dan “Markah Kasihan”: My Thought
Assalamualaikum,
Pembaca yang di rahmati Allah sekelian,
Buat pertama kalinya saya memecah tradisi weblog ini dengan berbahasa melayu. Mungkin isu yang ingin dikongsi bersama kali ini begitu dekat dihati. Baru-baru ini terpampang di dada akhbar harian Malaysia mengenai tohmahan yang tidak berasas dan berunsur fitnah terhadap Universiti Sains Islam Malaysia (USIM) di mana seorang mantan pensyarah telah cuba untuk menjatuhkan imej USIM. Oleh kerana USIM merupakan institusi yang unik dengan visi dan misinya tersendiri tempat di mana saya menabur bakti mendidik pelajar-pelajar, maka saya rasa terpanggil untuk memberikan sedikit respons terhadap isu ini.
Mungkin respons saya sedikit berbeza dengan maklumbalas dari perlbagai laman blog dan sebagainya. Pada saya, hanya ilmu yang dapat memberikan jawapan kepada tohmahan sebegini. Dengan ini, sebagai seorang ahli akademik saya ingin berkongsi artikel ringkas mengenai tanggungjawab seorang pendidik. Artikel ini sedikit sebanyak dapat bersama-sama memberikan renungan ke arah memiliki ciri-ciri ahli akademik unggul. Selamat membaca!!!!
AKAUNTABILITI AKADEMIA
1.0              PENGENALAN

Peranan ahli akademik  yang paling utama adalah untuk menyampaikan ilmu pengetahuan agar dapat membina rohani, jasmani, emosi, intelektual dan sosial pelajar yang seimbang. Dalam melaksanakan tanggunjawab ini ahli akademik yang baik mestilah mempunyai ciri-ciri tertentu seperti yang telah ditunjukkan oleh Rasulullah Sallallahu Alaihi Wasallam. Islam amat menitikberatkan ilmu pengetahuan dan meletakkan darjat yang tinggi kepada orang yang menyebarkan ilmu. Ini telah dirakamkan oleh Allah Subhanahu Wataala di dalam surah al-Mujadalah ayat 11 yang bermaksud: “Allah meninggikan darjat orang yang beriman dan di antara kamu, dan orang-orang yang diberi ilmu pengetahuan agama beberapa darjat”. Ayat ini menunjukkan bahawa orang yang berilmu mempunyai darjat yang lebih tinggi di kaca mata Islam[2] lebih-lebih lagi orang yang menyebarkan ilmu pengetahuan seperti ahli akademik sama ada di peringkat rendah mahu pun di institusi pengajian tinggi.
Sebagai seorang ahli akademik yang diberkati Allah, mereka mestilah menjaga akauntabilitinya selaras dengan kesucian dan keberkatan profesion ini yang melibatkan proses transformasi ilmu pengetahuan. Secara umumnya, para sarjana Islam telah mengemukakan bahawa ahli akademik perlu memainkan fungsi seorang guru dan mencapai martabat sebagai pendidik (mudaris), penyampai yang benar (mualim), murabbi (pengasuh dan pendidik dengan kasih sayang, muaddib (pembentuk adab dan akhlak) dan mursyid (pembimbing ke arah kebaikan)[3].
2.0       Akauntabiliti Akademia

Akauntabiliti akademia merupakan perkara yang amat penting untuk dipelihara oleh setiap ahli akademik. Secara umumnya akauntabiliti akademia merujuk kepada tanggungjawab seorang ahli akademik kepada setiap perkara mahu pun hasil kerjanya. Sebagai seorang yang profesional, ahli akademik perlu memelihara dan melaksanakan tanggunggjawabnya dengan penuh ikhlas dan sebaik mungkin. Ini adalah kerana ahli akademik merupakan pihak yang bertanggungjawab menghasilkan sumber manusia yang baik dalam pelbagai bidang demi keperluan negara bahkan umat seluruhnya. Secara ringkasnya akauntabiliti akademik ini boleh dibahagikan kepada tiga aspek utama iaitu kepimpinan, profesionalisme dan ketelusan serta kerahsiaan sama ada dalam hal ehwal pengajaran, penyelidikan, persidangan, penerbitan dan khidmat masyarakat.
2.1       Kepimpinan

Aspek kepimpinan ini merangkumi pengajaran, penyelidikan, persidangan, penerbitan dan khidmat masyarakat. Kepimpinan yang dimaksudkan adalah keupayaan mencorak, mengemudi dan memandu dalam proses pencapaian matlamat kecemerlangan institusi. Ahli akademik yang mempunyai ciri kepimpinan yang baik akan dapat mengatur strategi institusi dan berusaha mempertingkatkan kualiti, berusaha penambahbaikan kecekapan dan kejituan ilmu dan proses penyebaran ilmu pengetahuan.
2.2       Profesionalisme

Profesionalisme juga merangkumi aspek pengajaran, penyelidikan, penerbitan, persidangan dan khidmat masyarakat.  Profesionalisme dalam konteks ahli akademik merujuk kepada keupayaan dan kecekapan melaksanakan sesuatu tanggungjawab berdasarkan kepada panduan ilmu dan latihan, serta kepakaran. Di dalam melaksanakan sesuatu perkara seorang ahli akademik yang profesional adalah terikat dengan etika profesion yang merangkumi etika dalam keilmuan, etika sikap dan etika kemahiran.
Sebagai contoh seorang ahli akademik perlu menyerlahkan elemen-elemen penjagaan tingkahlaku seperti, cara berpakaian, berkomunikasi, tidak mengadakan hubungan dengan pelajar, mematuhi masa, menghormati rakan sejawat, mengelak plagiarisme, kerja berpasukan dan menjaga kerahsiaan. Para ahli akademik juga menjaga amanah ilmu bukan sahaja bertindak untuk memperkayakan ilmu dalam diri sebaliknya sentiasa menyalurkan idea-idea dan ilmu yang ada pada mereka baik kepada pelajar mereka disamping mempunyai integriti yang tinggi
Profesionalisme juga menitikberatkan aspek ketelusan dan kerahsiaan. Ahli akademik mesti sanggup menerima teguran-teguran dan ini akan dapat  meningkatkan lagi proses pengajaran dan pembelajaran. Dari aspek kerahsiaan, ahli akademik perlu menjaga hal kerahsiaan ini umpamanya soal penyediaan soalan peperiksaan dan juga maruah pelajar yang mempunyai masalah peribadi.
2.3       Pembudayaan Kualiti

Adalah menjadi kewajipan seorang ahli akademik untuk memastikan setiap hasil kerja mereka sesuatu yang berkualiti dalam semua aspek pengajaran, penyelidikan, penerbitan, persidangan dan khidmat masyarakat. Kualiti ini dapat dinilai melalui penerimaan hasil penyelidikan, persidangan dan penerbitan sama ada diperingkat tempatan mahu pun antarabangsa. Oleh itu ahli akademik perlu mempergiatkan aktiviti ilmiah dalam perkongsian ilmu, perluasan ilmu dan rangkaian tokoh-tokoh keilmuan, diinstitusi tempatan dan luar negara.
3.0       CIRI-CIRI AHLI AKADEMIK UNGGUL

Secara umumnya para ilmuan Islam telah menggariskan beberapa ciri ahli akademik unggul. Adalah menjadi kewajipan kepada semua ahli akademik untuk berusaha memenuhi kesemua ciri ini dan seterusnya mendapat keberkatan dari Allah Subhanahu Wataala pada setiap perkara yang dilakukan. Ciri-ciri ini dapat disimpulkan seperti berikut:-
a)                  Mudaris.

Mudaris berasal dari perkataan arab yang bermaksud mengajar ataupun pengajaran. Ahli akademik hendaklah bertanggunjawab menyampaikan ilmu yang ada padanya kepada pelajarnya yang boeh membina pemikiran, rohani, jasmani,emosi dan juga sosial. Apa yang diketahuinya hendaklah disampaikan kerana kerja pengajaran adalah sebahagian daripada amal soleh. Manakala enggan menyampaikannya adalah merupakan satu kesalahan.

b)                  Mualim.

Ahli akademik sebagai mualim boleh didefinasikan sebagai mengajar atau menyampaikan limu kepada orang lain dan mengamalkan apa yang disampaikan di samping berusaha menambah ilmu pengetahuan. Mualim mempunyai rasa belas kasihan kepada pelajar dan menganggap mereka seperti anak sendiri. Mualim mengajar kerana Allah Subhanahu Wataala dan bukannya kerana ganjaran dan tidak mengharapkan balasan daripada pelajar.

c)                  Murabbi.

Murabbi bermaksud memperbaiki, memimpin dan mentadbir. Ahli akademik sentiasa menyayangi pelajar dan menasihati dan membimbing dalam pembentukan syahsiyah mereka. Ahli akademik juga adalah kaunselor dan penyebar nilai budaya yang elok dan menjadi contoh kepada pelajar.

d)                 Muaddib.

Muaddib bermaksud mendidik ke arah memperelokkan lagi akhlak pelajar. Ahli akademik yang muaddib merupakan individu yang bertanggungjawab dan melaksanakan pendidikan peradaban dalam pengertian yang luas dan mendalam terhadap peribadi dan kehidupan pelajar. Muaddib seorang yang memberi ilmu dan mendidik mereka dalam akhlak dan adab yang baik. Ahli akademik juga mendidik pelajar agar tidak merendahkan ilmu pelajaran lain selain dari yang diajar olehnya. Ahli akademik mendidik pelajar melalui akhlak yang baik daripada hanya penyampaian secara teori sahaja.

e)                  Murshid.

Ahli akademik yang mursyid bermaksud sebagai penuntun jalan hidup yang benar dan betul dengan nilai dan sikap yang benar dan berperanan sebagai hamba Allah Subhanahu Wataala dan khalifahNya dimuka bumi. Mursyid menunjukkan kepada jalan yang benar dari sudut ilmu kesufian dan memberikan petunjuk kepada jalan yang lurus. Ahli akademik mempunyai tingkah laku baik dan terpuji, bersih dari akhlah tercela, tidak taasub atau fanatik, zuhud pada amalan dan perbuatan dan mempunyai tokoh kepimpinan. Syarat untuk menajdi ahli akademik yang mursyid ialah beliau mestilah alim dari segenap perkara atau disiplin ilmu, menyimpan atau menutup keaiban pelajar-pelajarnya dan pengajaran terkesan di dalam hati pelajar.
Kesemua ciri-ciri seorang ahli akademik unggul seperti di atas perlulah diamalkan secara berterusan dan dengan penuh iltizam. Ahli akademik perlu ada sifat mendidik pelajar kerana Allah Subhanahu Wataala, berperibadi mulia, menjaga kehebatan dan kehormatan diri, memiliki ilmu dan kaedah pengajaran dan bersifat kasih sayang. Bukan itu sahaja ciri-ciri ini perlu diamalkan dan diserlahkan dari semua aspek termasuk kepimpinan, profesionalisme, tingkahlaku, pembudayaan kualiti dan khidmat masyarakat.
4.0       LANGKAH MEMELIHARA AKAUNTABILITI AKADEMIA
a)                  Mendidik Kerana Mencari Keredhaan Allah Subhanahu Wataala[4].

Seorang ahli akademik perlu memastikan niatnya untuk bersifat ikhlas terhadap Allah Subhanahu Wataala dalam segala amal pendidik yang dilakukannya. Allah Subhanahu Wataala telah merakamkan dalam al-Quran surah al-Bayyinah ayat 5 yang bermaksud ”Dan tiadalah mereka itu diperintahkan, melainkan supaya mereka menyembah Allah dalam keadaan mengikhlaskan agama kepadanya”. Ini dikuatkan lagi dengan sabda Rasulullah Sallallahu Alaihi Wasallam yang bermaksud: ” Sesungguhnya Allah tidak akan menerima suatu amalan melainkan apa yang ikhlas kepadaNya dan yang ditujukan hanya untukNya. (Riwayat Abdu Daud dan an-Nasai).
Ahli akademik hendaklah menunjukkan setiap pekerjaan yang dilaksanakan itu hanya semata-mata kerana Allah kerana hanya dengan keikhlasan beliau akan mendapat keredhaan dan keberkatan bahkan akan dikasihi dan dihormati oleh pelajar mahupun masyarakat.
b)                 Peribadi Mulia[5].

Ahli akademik bukan sahaja menjadi ”role  model” atau pun ikutan kepada pelajar menerusi sifat spiritual seperti ikhlas, jujur, sabar, kasih sayang, warak dan takwa, bahkan menerusi sifat-sifat fizikal atau lahiriah seperti tutur kata, tingkah laku, kebersihan diri, pakaian, tempat tinggal dan lain-lain. Justeru itu, bagi mencapai keberkesanan proses pembelajaran dan pengajaran serta pembentukan peribadi mulia, Islam mengutamakan tutur kata, tingkah laku yang baik dan nasihat berguna serta menarik. Hal ini dapat dilihat jika kita merujuk dakwah yang dijalankan oleh Nabi Musa dan Nabi Harun, ketika mereka menyampaikan seruan agama kepada Firaun yang amat zalim seperti yang difirmankan oleh Allah Subhanahu Wataala dalam al-Quran surah thaha ayat 43 yang bermaksud:-” Pergilah engkau berdua kepada Firaun, sesungguhnya dia derhaka. Katakanlah kepadanya  perkataan yang lemah lembut, mudah-mudahan ia akan dapat pengajaran atau takut kepada tuhan”.
c)                  Menjaga Kehebatan dan Kehormatan diri[6].

Sudah menjadi tanggapan masyarakat mahupun pelajar bahawa seorang ahli akademik adalah seorang yang mempunyai kehormatan diri dan kehebatan ilmu pengetahuan. Oleh itu, sudah semestinya ahli akademik untuk beramal dan berpegang teguh dengan ilmu yang dimilikinya. Setiap amalan mestilah dilakukan dengan istiqamah dan seterusnya menjadikan diri untuk lebih bertakwa kepada Allah Subhanahu wataala. Ahli akademik tidak sepatutnya melakukan perkara yang berlawanan dengan ilmu yang dimiliki kerana ini akan menjatuhkan kehormatan diri dan mengurangkan rasa hormat pelajar kepadanya. Hal ini telah dirakamkan oleh Allah Subhahanahu Wataala di dalam surah al-Maidah ayat 44 yang bermaksud:-” Adakah patut kamu menyuruh manusia membuat kebajikan dan kamu lupakan diri kamu sendiri sedangkan kamu membaca kitab Allah, tidakkah kamu berakal”.
d)                 Memiliki ilmu dan kaedah pengajaran[7].

Ahli akademik sememangnya perlu memiliki ilmu yang mantap dan mendalam dalam bidang yang diceburi. Pelajar akan lebih yakin dan mudah menerima ilmu yang disampaikan sekiranya ahli akademik benar-benar menguasai ilmu tersebut. Selain itu, ahli akademik juga perlu kreatif dan inovatif dalam menggunakan kaedah atau teknik pengajaran berkesan. Dalam dunia moden masa kini, ahli akademik perlu arif dalam penggunaan teknologi dan dalam masa yang sama sentiasa mempelbagaikan teknik pengajaran agar lebih berkesan dan menarik minat pelajar.
e)                  Bersifat kasih sayang.[8]

Pelajar merupakan golongan yang masih muda dan perlukan perhatian oleh pendidik mereka. Oleh itu ahli akademik mesti mempunyai sifat kasih kepada pelajar dan menganggap mereka seperti anak sendiri. Dengan sifat ini, pelajar akan lebih mudah mendekati ahli akademik dan dapat meluahkan masalah mereka. Sifat ini juga akan dapat menerbitkan suasana mesra di antara pelajar dan ahli akademik dan seterusnya akan memudahkan lagi proses pentarbiyahan dan pembentukan peribadi mulia.
5.0  KESIMPULAN.

Secara umumnya, seorang ahli akademik harus mencapai martabat seorang pendidik iaitu murabbi, mudaris, mualim, muaddib dan mursyid. Kedudukan seorang ahli akademik yang mursyid menjadikan setiap ilmu pengetahuan yang disampaikan akan menjadi lebih berkesan dan mudah diterima oleh para pelajar. Terdapat beberapa ciri utama seorang ahli akademik yang membolehkan mereka dapat membimbing pelajar dengan baik dan berkesan. Ini termasuk mendidik kerana Allah, berperibadi mulia, menjaga kehebatan dan kehormatan diri, memiliki ilmu dan kaedah pengajaran dan bersifat kasih sayang.
Akauntabiliti akademia merupakan perkara yang amat penting untuk dipelihara oleh setiap ahli akademik dan ini meliputi dari aspek kepimpinan, profesionalisme dan ketelusan serta kerahsiaan sama ada dalam hal ehwal pengajaran, penyelidikan, persidangan, penerbitan dan khidmat masyarakat. Sesungguhnya sebagai seorang ahli akademik, beliau mestilah berusaha untuk memenuhi ciri-ciri seorang pendidik yang mursyid di mana mampu untuk membimbing pelajar bukan sahaja untuk mendalami ilmu pengetahuan yang disampaikan malahan dapat memberi panduan kepada mereka untuk menjadi insan yang berguna dan berjaya. Akauntabiliti akademia mesti dipelihara demi menjamin keutuhan institusi keilmuan yang sememangnya dipandang tinggi oleh Islam.
[2] Rujuk Al-Ghazali. Ihya Ulumuddin. (Terjemahan) . 2006. Kuala Lumpur: Darul Fajar. Hlm 1-14.

[3] Ahmad Mohd Salleh. (2004). Pendidikan Islam. Selangor: Fajar Bakti. Hlm 122-123.

[4] Abdullah Ishak. (1989). Sejarah Perkembangan Pelajaran dan Pendidikan Islam. Selangor: Ar-Rahmaniah. Hlm. 122-123.

[5] Ibid hlm 128.

[6] Ulwan Abdullah Nasih. (1981). Tarbiyatul Awlad Fi Islam. Juzuk 1. Darul Salam dalam Ahmad Mohd Salleh. (2004). Pendidikan Islam. Selangor: Fajar Bakti. Hlm 126-127.

[7] Supra nota 3 hlm 126.

[8] Yaakub Isa. (1994). Guru dan Pengajaran yang efektif dalam Ahmad Mohd Salleh. (2004). Pendidikan Islam. Selangor: Fajar Bakti. Hlm 126-127.
Best Regards

ZULKIFLI HASAN

DUBAI, UAE
Dubai Mall, United Arab Emirates.
My Thought
4 Comments
April 19, 2009
DR. ZULKIFLI HASAN
Where the USD5 Trillions is coming from?: Remarkable Analysis by Rodney Shakespeare and Max Keiser
Assalamualaikum,
Dear Readers,
While recent G20 meeting in London outlined their plan to solve the current financial crisis and it seems to be plausible action, Rodney Shakespeare (Binary Economist) and Max Keiser (Financial Journalist) tried to disclose the otherwise. I assure you that this exclusive interview is very illuminating. Click here:
http://criticmagazine.blogspot.com/2009/04/analysis-of-g20-meeting-outcome.html
Best Regards

ZULKIFLI HASAN

DUBAI, UAE
Fujeirah, United Arab Emirates
Islamic finance news
Leave a comment
April 17, 2009
DR. ZULKIFLI HASAN
In Person With Aamir Rehman, a Head of Strategy for Fajr Capital
Aamir A. Rehman is an expert in global corporate strategy. He was formerly the global head of strategy for HSBC Amanah, a business unit of the world’s third largest bank serving over 300,000 customers in major markets worldwide. As an advisor to Fortune 500 and other leading businesses, Mr. Rehman has helped develop strategies for multinationals across the globe, including the United States, Europe, the UAE, Saudi Arabia, and the broader Middle East. Previously a consultant with the Boston Consulting Group, he holds an MBA from the Harvard Business School, a master’s degree in Middle Eastern Studies from Harvard University, and a bachelor’s degree from Harvard College. He is author of Dubai & Co.: Global Strategies for Doing Business in the Gulf States (McGraw-Hill 2007), a guide to corporate strategy in the GCC region and “Islamic Finance: The New Global Player” (Harvard Business Review, February 2008 ) and of several other articles. His commentary has been featured in the Wall Street Journal, the Financial Times, the Wharton Leadership Digest, US News and World Reports, and other leading media outlets.
Best Regards

ZULKIFLI HASAN

DUBAI, UAE
With Aamir Rehman at his office
My Story
Leave a comment
April 8, 2009
DR. ZULKIFLI HASAN
Bringing Together Shari’ah and Common Law in Malaysia
Assalamualaikum,
Dear Readers,
I am very grateful to share my recent article published in Business Islamica magazine. This article is also available at
http://www.islamica-me.com/main.asp
. Business Islamica is the first monthly magazine of its kind in the United Arab Emirates, specifically covering all aspects of Islamic business and finance both regionally and internationally. Enjoy reading!
Bringing Together Shari’ah and Common Law in Malaysia
Malaysia has a very unique legislative framework consisting of mixed legal systems, namely common law and the Shariah. Common law principles are applied in the civil courts in almost all legal matters. Islamic law is practiced in the Shariah courts and only pertains to family matters and inheritance law. The Federal Constitution places Islamic banking matters under the jurisdiction of the civil court. Malaysia has achieved tremendous growth in developing the Islamic banking industry locally as well as internationally. This achievement is due to the comprehensive approach of the authorities as well as Islamic banking players, especially in legal aspects. The growth and development of the Islamic banking industry are supported through good governance and a comprehensive legal framework. It is essential to have a standard law of practice which harmonizes Shariah and civil law in the context of Islamic banking.
Finding Agreement

Common law originated in England. It is a system based on precedent derived from judgments by judges. Shariah refers to rules of Islamic law. Shariah governs many aspects of day-to-day life, including politics, economics, banking, business law, contract law and social issues. In Arabic, harmonization is known as Tawfiq, which means to bring one thing into harmony or agreement with another (two or more different types of ideas). In Malaysia, this can refer to the integration of Islamic and common laws. It is interesting to note that the issue of harmonization arose out of the negotiation leading to the formation of Malaysia in 1963. With a diverse historical, racial and cultural background, the process of harmonization in the country was carried out through modification of existing laws. Harmonization of Shariah and common law in the context of Islamic banking does not mean combining these two systems without taking Shariah principles into consideration; it refers to the implementation of common law principles which are not contrary to Islamic law. The existing laws that are in line with Shariah principles can be integrated to further strengthen the legal infrastructure of Islamic banking.
Reasons for Harmonization

Harmonization is more of a process than a goal. It is not combining Shariah and common law across the board, but only harmonizing certain disparities in selected areas. Harmonization is particularly necessary in the case of Islamic banking, especially when there are disputes between two or more parties that are brought to court. These disputes are heard in the civil court according to Schedule Nine, List 1 of the Federal Constitution. Since Islamic finance takes its place alongside conventional finance, there are many procedural laws and substantive legislation based on common law principles that relate to Islamic banking. A number of these existing laws are in line with Shariah principles and we do not need to enact new ones. In fact, a study performed by Pakistani scholars revealed that only a small portion of Pakistani civil law (which is quite similar to Malaysian law) is considered to be unIslamic. The process of harmonization of Shariah and common law in Malaysia relating to Islamic banking involves several elements:
Dual Banking System and Moderate Approach

Malaysia decided to introduce a dual banking system in which existing conventional banking is practiced side by side with the Islamic banking system. Malaysia Berhad started its operations as Malaysias first Islamic bank in 1983, beginning what can be considered the first phase of Islamic banking in Malaysia, which lasted until 1993. In 1993, the Central Bank of Malaysia introduced an interest-free banking scheme which allowed conventional banks to offer Islamic banking products through windows. Many conventional banks set up Islamic windows once this was introduced. This was the beginning of the second phase of development for Malaysian Islamic banks, which continues today as the country liberalizes its Islamic banking policies so as to enable us to lead the sector. These phases have been facilitated and supported by legal infrastructure built through several laws and directives, particularly the Islamic Banking Act 1983, the Banking and Financial Institutions Act 1989, the Central Bank of Malaysia (Amendment) Act 2003, other relevant statutory legislation, the Central Bank of Malaysias directives and court developments.
Federal List

In Malaysia, separate Islamic legislation and banking regulations exist side by side with those of the conventional banking system. Islamic banking was put under the Federal List since it refers to commercial dealings, although Islamic banking actually falls under the purview of Islamic law.
Islamic Banking Laws

The legal basis for the establishment of Islamic banks was the Islamic Banking Act (IBA) of 1983. The IBA gives the Central Bank of Malaysia power to supervise and regulate Islamic banks as it does other licensed banks. However, the IBA, with 60 sections divided into eight parts, is obviously very brief and it is regulatory rather than substantive in nature. Although the IBA is general and noncomprehensive, which has led to various interpretations, it does allow flexibility for Islamic financial institutions in their operations. For example, Section 2 of the IBA defines “Islamic banking business” as “banking business whose aims and operations do not involve any element, which is not approved by the Religion of Islam.” This section can be interpreted negatively or positively. The negative view is that the IBA does not stipulate how the section is to be understood in the context of Islamic banking. On the other hand, it could be understood that the purpose of such a general provision is to create a flexible approach to the implementation of Islamic banking. As a result, Islamic financial institutions in Malaysia may offer various banking products under multiple modes of financing based on Shariah principles. Malaysia has the distinction of being first in several issuances of Islamic bonds, including the first to issue a global sovereign Sukuk. Many Islamic banking products have been introduced in a range of sectors, such as financing for personal consumption, small to medium entrepreneurs or huge corporations. The increasing demand for Islamic products has driven tremendous growth in the Islamic banking sector. Moreover, non-Muslims have also been attracted to the Islamic products offered on the market. In responding to the demands of conventional banks to open Islamic counters, Section 124 of the Banking and Financial Institutions Act 1989 (BAFIA) was introduced, which allowed conventional banks to do Islamic banking business. They are required to establish Shariah committees to advise them on any matter related to Islamic banking or finance.
Amendment and Review of Laws

As the Islamic banking sector develops, there should be continuous revision of relevant laws. The Central Bank of Malaysia has several committees to review existing legislation, with the aim of removing impediments to the efficient functioning of the Islamic financial system.Apart from the IBA and the BAFIA, the Central Bank of Malaysia (Amendment) Act 2003 (CBA) has played a major role in terms of supervising and monitoring Islamic banking. The CBA mandates the National Shariah Advisory Council (SAC) as the sole authority for the civil courts pertaining to Islamic banking and finance. Section 16B (1) of the CBA 1958 provides that banks can establish an Advisory Council which would be the authority on Islamic law for the purposes of Islamic banking, finance and development finance, Takaful or any other business which is based on Shariah principles and is supervised and regulated by the Central Bank of Malaysia. The effect of the amendment is to ensure that any deliberation of the SAC will be binding in the court and should be followed by all Islamic financial institutions in Malaysia. Section 16 B (8) provides that, in any proceedings relating to Islamic banking or financial business before any court or arbitrator, if any question arises concerning a Shariah matter, the court or arbitrator may refer such question to the SAC. Rulings made by the SAC must be taken into consideration by the court, and if the reference was made by an arbitrator, be binding on the arbitrator. Another significant law in the implementation of Islamic banking is the Hire Purchase Act 1948 (HPA). The HPA only governs certain types of vehicles and it contains an element of interest. Due to the obstacles to meeting the requirement of the HPA, some Islamic banks opt to offer financing for vehicles based on the concept of Bay Bithaman Ajil. This creates problems for the bank in terms of repossession of vehicles in the case of default. Under the concept of Bay Bithaman Ajil, the bank cannot simply repossess the vehicle without a court order, while under the HPA, the bank may do it through notice of repossession. It is reported that the Central Bank of Malaysia has set up a working committee to study the requirements of an Islamic Hire Purchase Act. This act would cover not only vehicles but also financial leases of immovable property. Islamic banking products, especially for debt financing, involve trading transactions, while conventional banking products may only involve a loan transaction. Basically, this concerns the financing of houses, motor vehicles, land, consumer goods, cash line facilities, education financing packages and personal consumption. Trading transactions require two separate agreements, purchase agreements and selling agreements, and this results in double taxation. In order to stimulate the growth and development of the Islamic banking sector, the government introduced incentives for Islamic financial institutions through tax exemption. Any legal documentation that involves trading transactions will only incur normal tax, as provided under the Stamp Act 1948. This incentive is very effective and, in fact, debt financing is the biggest contributor in terms of growth and profit to Islamic financial institutions in Malaysia.
Coordination Between the National Shariah Advisory Council and the Court

In Malaysia, Islamic banking cases are under the jurisdiction of the civil courts. The issue here is the judges in civil courts face difficulties in understanding certain concepts and terms of Islamic finance. To address this problem, the Central Bank of Malaysia, with the cooperation of the judicial body, agreed to set up a special High Court in the Commercial Division known as the Muamalah Bench. All cases under code 22A filed in the High Court of Malaya are registered and heard in the High Court Commercial Division 4. This special court deals exclusively with Islamic banking cases.
Governance of Shariah Committees

The Central Bank of Malaysia has issued guidelines to regulate the governance of Shariah committees of Islamic financial institutions. According to the guidelines, Shariah committee members must have qualifications or possess necessary knowledge, expertise or experience in Islamic jurisprudence or Islamic transaction or commercial law. The guidelines also state that the SAC has the authority to decide on the Shariah compliance of any issue in Islamic finance.
The Impact of Harmonization

The impact of Malaysias harmonization approach can be seen through the achievement and growth of the Islamic banking sector in Malaysia as well as the recognition of its products worldwide. This could not have been accomplished if there were no effective and comprehensive legal mechanism for governing the implementation of Islamic banking. As Malaysia operates within both Islamic and common law traditions, the harmonization process is one of the best approaches to facilitate Islamic banking transactions.
Best Regards

ZULKIFLI HASAN

DUBAI, UAE
With Professor Dr. Masudul Alam Choudhury, Professor Rodney Shakespeare and Professor Dr. Nur Alam Siddiqi in Jakarta, Indonesia
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Monthly Archives: June 2013
June 26, 2013
DR. ZULKIFLI HASAN
Africa Needs Islamic Financing to Fund Infrastructure
Africa Needs Islamic Financing to Fund Infrastructure – Sanusi
BY DANIEL ADUGBO Available at:
http://allafrica.com/stories/201306260767.html
Nigeria and other African countries need to tap into opportunities provided by Islamic financing to fund infrastructure on the continent, Governor of Central Bank of Nigeria, Sanusi Lamido Sanusi, has said.
The CBN governor said this yesterday in Abuja at a conference on infrastructure development through Alternative Funding (Islamic finance) in Africa.
The event was organized by the Metropolitan Skills Limited, Abuja in collaboration with the Islamic Finance Institute of South Africa.
Sanusi who was represented by his Special Adviser on Non-Interest Banking, Dr. Bashir Aliyu Umar, said Islamic bonds called Sukuk, if well developed can serve as a financing option for governments as is already evidenced in countries like Saudi Arabia, United Arab Emirates and others.
“It is my belief that if properly structured, Islamic bond will compliment government’s efforts in infrastructure development,” Sanusi said.
Also at the event, former Managing Director of Jaiz Bank, Mustapha Bintube, said Islamic banking has come to stay in Nigeria.
“In Nigeria, many people told me it was not possible but today, with a modest beginning, it is going to stay and it is going to make impact in the economy of this country,” he said.
The acting Managing Director of Jaiz Bank, Usman Hassan, urged the federal government to conclude the development of the framework for the issuance of Sukuk in the country.
This is necessary because with Sukuk you cannot have failed projects and “cannot be diverted.”
Regards

Zulkifli Hasan
Cape Town South Africa
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June 22, 2013
DR. ZULKIFLI HASAN
Islamic finance in Tunisia could reach 25-40% share
Islamic finance in Tunisia could reach 25-40 pct share -study
By Bernardo Vizcaino Available at:
http://www.reuters.com/article/2013/06/16/islamic-finance-tunisia-idUSL5N0ES02S20130616
DUBAI, June 16 (Reuters) – Tunisia’s fledgling Islamic finance industry could take a 25 to 40 percent share of the country’s financial sector in five years’ time if necessary rules, consumer education and private investment plans materialise, a Thomson Reuters study found.
Islamic finance was previously neglected by Tunisia’s rulers but in the wake of the 2011 revolution, the new Islamist-led government is promoting the industry.
Currently, sharia-compliant business accounts for just 2.5 percent of the Tunisian financial sector, the study said. In the Gulf Arab states, the ratio is believed to be about a quarter.
The study estimates that Islamic financial assets in Tunisia could reach $17.8-$28.5 billion by 2018, up from $1.4 billion at present.
In a poll of about 700 ordinary Tunisians conducted for the study, 54 percent said they would consider switching to banking with Islamic lenders even if that meant lower rates of return, while 40 percent would be open to switching even if their money was not guaranteed.
But 64 percent of respondents said they were unclear about how Islamic finance worked.
SUKUK
One boost for Islamic finance in Tunisia would be issuance of the country’s first sukuk, which the government is planning.
“I expect the issuance process to take place in the second half of 2013,” Chaker Soltani, general director of debt management and financial cooperation at the finance ministry, was quoted as saying in the study.
The Jeddah-based Islamic Development Bank (IDB) has given Tunisia a financial guarantee to issue a sukuk worth $600 million. Last week, the IDB extended said it would extend $1.2 billion in funding to Tunisia for industrial, agricultural and trade projects.
Mohamed Sadraoui, deputy director of general supervision and banking regulation at the central bank, said Islamic windows – units of conventional banks that offer Islamic financial services – would be permitted to operate under central bank guidelines that ensured operations were segregated.
“There are four or five well-known banks in Tunisia that are trying to facilitate the way for their Islamic finance businesses,” said Mahmoud Mansour, deputy general manager of the Tunisian arm of Bahrain-based lender Al Baraka Bank.
He added that three takaful (Islamic insurance) companies had applied for licences.
Al Baraka, which entered the country in 1983, is awaiting approval for an onshore banking licence so it can open more branches and serve a broader client base, said Mansour.
Zitouna Bank, the country’s only full-fledged domestic Islamic lender, also plans expansion.
“We are planning for over 100 branches across the country within the next five years,” Ezzedine Khoja, president and general manager of Zitouna Bank, said in the study.
The bank, set up in 2009, plans to increase its capital base to 100 million dinars ($61.7 million) from the current 70 million dinars by the end of this year, as well as launching an investment funds unit and possibly expanding abroad, he added.
Some industry practices that are controversial among some Islamic scholars, and could therefore affect customer perceptions, are generally being avoided in Tunisia, the study found. One of these is tawarruq or commodity murabaha, a common cost-plus-profit arrangement in Islamic finance.
“We here in Tunisia do not consent to tawarruq, a product that is widely spread in the GCC (Gulf Cooperation Council),” said Khoja.
“We don’t believe in this product and reject its use for Tunisia, despite its widespread use in other jurisdictions.”
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Zulkifli Hasan
Sarajevo, Bosnia and Herzegovina
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June 21, 2013
DR. ZULKIFLI HASAN
The Reconstruction of Islamic Thought: Syikwah and Jawab Syikwah by Allama Muhammad Iqbal
Dear My weblog readers,
I take this opportunity to share with you these amazing pieces by Sir Muhammad Iqbal. Very inspirational and thought provoking. These poems have provoked debate and controversy and even some scholars criticized Allama Iqbal of being rude and harsh in his words when talking to God.
I believe these poems will be good entertainment for us and at the same time able to stimulate our thought with the reality of the Muslims world today. I dedicate these poems to all my fellow Muslims brothers and sisters.
Enjoy reading, watching and listening!!!!
The Complaint (Syikwah)
Why should I abet the loss, why forget the gain,

Why forfiet the future, bemoan the past in vain?
Hear the wail of nightingal, and remain unstirred,

Am I a flower insensate that will not say a word?
The power of speech emboldens me to speak out my heart,

I’ll sure be damned, I know, if fault my God.
Hear, O Lord, from the faithful ones this sad lament,

From those used to hymn a praise, a word of discontent.
Enternally were you present, Lord, eternally omniscent,

The flower hung upon the tree, but without incense.
Be Thou fair, tell us true, O fountsinhead of grace,

How could the scent spread withoutthe breeze apace?
The world presented a queer sight ere we took the stage,

Stones and plants in your stead were worshipped in that age.
Man, being inured to senses, couldn’t accept a thing unseen,

How could a formless God impress his senses keen?
Tell me, Lord, if anyone ever invoked Thy name,

The strength of Muslim arm alone restored Thy fame.
There was no dearth of peoples on this earth before,

Turkish tribes and Persian clans lived in days of yore;
The Greeks and the Chinese both bred and throve,

Christians as well as the Jews on this planet roved.
But who in Thy holy name raised his valiant sword,

Who set the things right, resolved the rigmarole?
We were the warrior bands battling for Thy cause,

Now on land, now on water, we the crusades fought.
Now in Europe’s synods did we loudly pray,

Now in African deserts made a bold foray.
Not for territorial greed did we wield the sword,

Not for pelf and power did we suffer the blows.
Had we been temped by the greed of glittering gold,

Instead of breaking idols, would have idols sold.
We impressed on every heart the oneness of our mighty Lord,

Even under the threat of sword, bold and clever was our call.
Who conquered, tell us Thou, the fearful Khyber pass?

Who vanquished the Imperial Rome, who made it fall?
Who broke the idols of the primitive folks?

Who fought the kafirs, massacred their hordes?
If the prayer time arrived right amid the war,

With their faces turned to Kaaba, knelt down the brave Hejaz.
Mahmud and Ayaz stood together in the same flank,

The ruler and the ruled forget the difference in their rank.
The rich and poor, Lord and slave, all were levelled down,

All became brethern in love, with Thy grace crowned.
We roamed the world through, visited every place,

Did our rounds like the cup, serving sacred ale.
Forget about the forests, we spared not the seas,

Into the dark, unfathomed ocean, we pushed our steeds.
We removed falsehood from the earth’s face,

We broke the shackles of the human race.
We reclaimed your Kaaba with our kneeling brows,

We pressed the sacred Quran to our heart and soul.
Even then you grumble, we are false, untrue,

If you call us faithless, tell us what are you?
You reserve your favours for men of other shades,

While you hurl your bolts on the Muslim race.
This is not our complaint that such alone are blesse,

Who do not know the etiquette, nor even can converse.
The tragedy is while kafirs are with houries actually blest,

On vague hopes of houries in heaven the Muslim race is made to rest!
Poverty, taunts, ignominy stare us in the face,

Is humiliation the sole reward of our suffering race?
To perpetuate Thy name is our sole concern,

Deprived of the saqi’s aid can the cup revolve and turn?
Gone is your assemblage, off your lovers have sailed,

The midnight sights are no more heard, nor the morning wails;
They pledged their hearts to you, what is their return?

Hardly had they stepped inside, when they were externed.
Thy lovers came and went away, fed on hopes of future grace,

Search them now with the lamp of your glowing face.
Unassuaged is Laila’s ache, unquenched is Qais’s thirst,

In the wilderness of Nejd, the wild deer are still berserk.
The same passion thrills the hearts, enchanting still is beauty’s gaze,

You are the same as before, same too is the Prophet’s race.
Why then this indifference, without a cause or fault?

Why with your threatening looks dost thou break our heart?
Accepted that the flame of love burneth low and dim,

We do not, as in your, dance attendance on your whims;
But you too, pardon us, possess a coquettish heart,

Now on us, now on others, alight your amorous darts.
The spring has now taken leave, broken lies the lyre string,

The birds that chirped among the leaves have also taken wing;
A single nightingale is left singing on the tree,

A flood of song in her breast is longing for release.
From atop the firs and pines the doves have flown away,

The floral petals lie scattered all along the way.
Desolate lie the garden paths, once dressed and neat,

Leafless hang the branches on the naked trees.
The nightingale is unconcerned with the season’s range,

Would that someone in the grove appreciates her wail.
May the nightingale’s wail pierce the listeners’ hearts,

May the clinking caravan awaken slumbering thoughts!
Let the hearts pledge anew their faith to you, O Lord,

Let’s re-charge our cups from the taverns of the past.
Through I hold a Persian cup, the wine is pureHejaz,

Thought I sing an Indian song, the turn is of the Arabian cast.
The Answer (Jawab Syikwah)
JAWAB E SHIKWA
The word springing from the heart surely carries weight,

Though notendowed with wings, it yet can fly in space.
Pureand spiritual in its essence, it pegs its gaze on high,

Rising from the lowly dust, grazes past the skies.
Keen, defiant, and querulous was my passion crazed,

It pierced through the skies, my audacious wail.
“Someone is there,” thus spoke the heaven’s warder old,

the planets said, “From above proceeds this voice so bold.”
“No, no,” the moon said,” “tis someone on the earth below,”

Butted in the milky way: “The voice is hereabouts, I trow.”
Ruzwan alone, if at all, understood aright,

He knew it was the man, from heaven once exiled.
Even the angles wondered who raised this cry,

All the celestial denizens looked about surprised.
Does man possess the might to scale empyreal heights?

Has this mere pinch of dust learnt the knack to fly?
What are these earthly folks? Careless of all respect,

How bold and impudent, the lowly dwellers of the earth!
Extremely rude and insolent, cross even with God,

Is it the same Adam whom angels once did laud?
Steeped in bliss, man is of wisdom’s lore possessed,

Nonetheless, he’s alien to humility’s sterling worth.
Man feels proud of the power of his speech,

But the fool doesn’tknow how and what to speak.
You narrate a woeful tale, thus the voice arose,

Your heart is boiling overwith tears uncontrolled.
You have delivered your plaint with perfect skill and art,

You have brought the humans in contact with God.
We are inclined to grant, but none deserves our grace,

None treads the righteous path, whom to show the way?
Our school is open to all, but talent there is none,

Where is that soil fertile to breed the human gems?
We reward the deserving folks with splendid meed,

We grant newer worlds to those who strive and seek.
Arms have been drained of strength, hearts have gone astray,

The Muslim race is a blot on the Prophet’s face.
Idol-breakers have left the scene, idol-makers remain,

Aazar has inheritedAbraham’s glorious name.
Wine, flask,and drinkers-all arenew and changed,

A differentKaaba, different idols now your worship claim.
Therewas a time when you were respected far and wide,

Once this desert bloom was the season’s wealth and pride.
Every Muslim then was a lover profound of God,

Your sole beloved once was the all-embracing Lord.
Who removed falsehood from the earth’s face?

Who broke the shackles of the human race?
Who reclaimed our Kaaba with their kneeling brows?

Who presses the sacred Quran to their heart and soul?
True, they were your forbears, but what are you, I say?

Idle sitting, statue-like you dream away your days.
What did you say? Muslims are with hopes of houries consoled,

Even if your plaint is false, your words should be controlled.
Justice is the law supreme, operative on this globe,

Muslims can’t expect the houries, if they follow the kafir’s code.
None of you is,infact,deservingof the”hoor”,

A Moses is but hard to fin,burneth still the Tur.
Common to the race entire is their gain or loss,

Common is their faith and creed, common too the Rasul of God;
One Kaaba, one Allah, and one Quran inspire their heart,

Why can’t the Muslims then behave like a single lot?
Cast, creed and factions have disjointed this race,

Is this way to forge ahead, to flourish in the present age?
It’s the poor who visit the mosque, join the kneeling rows,

The poor alone observe the fasts, practise self-control.
If someone repeats our name, it’s the poor again,

The devout poor hide your sins, preserve your vaunted name.
Drunk with the wine of wealth, the rich are unconcerned with God,

The Muslim race owes its life to the poor, indigent lot.
“Muslims have vanished from earth,” this is what we hear,

but we ask, ” Were the Muslims ever the Jewish sects.
You are Nisars by your looks, but Hindus by conduct,

Your culture puts to shame even the Jewish sects.
If the son is alien to his learned father’s traits,

How can he then claim his father’s heritage?
All of you love to lead a soft, luxurious life,

Are you a Muslim indeed? Is this the Muslim style?
All of you desire to be invested with the crown,

You should first produce a heart worthy of renown.
The new age is the lighting blast, it will set your barns on fire,

It can’t produce in groves or deserts the Old Sinai’s burning spire.
The new fire consumes for fuel the blood of nations old,

The clothes of the Prophet’s race are incinerated in its folds.
Don’t be depressed, gardener, by the present scene,

The starry buds are about to burst with a brilliant sheen.
The garden will soon be rid of its thorns and weeds,

The martyr’s blood will bring to bloom all the dormant seeds.
Mark how the sky reflects its orange purple hues,

The rising sun will flush the sky with its rays anew.
Islamic tree exemplifies cultivation long and hard,

A fruit of arduous gardening over centuries past.
Your caraven needn’t fear the perils of the path,

But for the call ofbells you own no wealth at all.
You are the plant of light, the burning wick that never fails,

With the power of your thought you can incinerate the veil.
We’ll love you as our own, if you follow the Prophet’s ways,

The world is but a paltry thing, you’ll command the pen and page.
Best Regards

ZULKIFLI HASAN
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June 12, 2013
DR. ZULKIFLI HASAN
How Islam & Democracy Can Support Each Other
VISIONS FOR A NEW TUNISIA: How Islam & Democracy Can Support Each Other
By Rached Ghannouchi  Available at:
http://www.ikhwanweb.com/article.php?id=31006
In the name of God, prayers and peace be upon all His Messengers,Ladies and gentlemen, brothers and sisters, may God’s peace and blessings be upon you.
I thank the Center for the Study of Islam and Democracy (CSID) for giving me the opportunity to speak to this distinguished elite group of American scholars, experts and policy makers, as well as those coming from other countries to participate in this important conference.
I would like to briefly address the issue of  the Democratic Transition in Tunisia and the challenges that we are facing.
The success of the Democratic Transition in Tunisia is not important for Tunisia only but for the whole region because it will establish the first country in the region which is both democratic and Muslim. That is why in Tunisia we feel the burden of this responsibility and try our best to make it succeed. Our revolution is not for export, but we hope that a successful model can influence the rest of the region.
Since before the elections, we announced that we will choose to govern through a coalition with other secular parties. We could have formed our government by getting the support of independents but we chose to form a coalition that had the widest degree of support across the political spectrum. We believe that in transitional periods simple majority government isn’t enough but we need a wide coalition to send a message that the country is for all and not just the majority. We believe that moderate Islamists and moderate secularists can and should work together and that they both should find compromises to build consensus across the spectrum.
We have tried hard to avoid ideological polarization because this is recipe for chaos and failure, that is why we have made many concessions whether in government or in the constitution so as to avoid this danger.
We believe in the need for coexistence between secularists and Islamists, in the framework of the Troika with the Congress for the Republic and the Democratic Forum for Work and Liberties (Attakatol), on the basis of a number of convictions including:
First: There is no contradiction between Democracy and Islam. Democracy does not mean that governance should be particularly granted to secularists while considering the Islamists as enemies of the state who should be either imprisoned or exiled. It does not also mean excluding secularists from power and marginalizing their role in authority and in drafting the Constitution simply because they did not get a majority in the elections.
Second: Islamists’ arrival to power does not mean that they will dominate the state, the society, and the revolution because they are the most popular party, as practiced by tyrannical systems. the state’s role is not to impose a certain way of life on the people but it’s role is to provide security and services to its people then let them make their own choices with regards to their way of life.
Third: The conflict between secularists and Islamists, which has continued for decades, wasted enormous energies and helped dictatorships in their control of our countries.

Therefore the alliance between Islamists and secularists is important for the establishment of a democratic and free society able to handle its differences, even through deep and sincere dialogue.
Ladies and Gentelmen,
On the Question of the Constitution:
The Constitution is an important document as it limits the government’s and the rulers’ authorities and forces it to abide by the law. We have a precedent in Islamic history in the form of what is known as ‘al-sahifa’ which came at the time of the establishment of the first Islamic state by the Prophet peace be upon him. This constitution established a pluralistic state that brought together different ethnicities and religions and established citizenship as the basis of rights and responsibilities.
We are happy that over the last few days in Tunisia , the committees of the constituent assembly have finally managed to finish working on the final draft of the constitution. This will hopefully be presented to the whole assembly over the next few weeks.
The guiding principle for us in this constitution is that it should not just be the constitution of the simple majority but that it should be the constitution of all Tunisians, that all Tunisian can see themselves in this constitution and that they feel that it represents them all, whether in the majority or the minority.
In order to achieve this we have organized wide consultations with the different political players and with civil society organizations. Through this process we try to develop a wide consensus around the constitution. However when we faced serious differences around issues like Sharia, the political system whether presidential or parliamentary, around the freedom of conscience, the universality of human rights, we had to organize a national dialogue between the main parties to reach consensus, and this lasted for nearly 5 weeks and ended up in reaching compromises around these different issues hence we accepted to leave any mention of shariah in the constitution because this notion wasn’t clear to the Tunisian people, with regards to the political system, although we chose the parliamentary system initially, we ended up in a compromise where we have a mixed system where the executive power is divided between the president and the Prime Minister, we also made compromises by accepting the universality of human rights and the freedom of conscience. Some people Within our party accuse us in the leadership that we have become the party of compromise, but we say that as the largest party we have a greater responsibility to make the necessary compromises to help our country move forward.
We believe that we have now a draft constitution that brings together the values of Islam and combines them with the values of modernity and democracy. This had been the dream of the great reformers since the 19th century and we hope that through ratifying the constitution that we would have realized this dream. The new constitution incorporates all the values of equality, the different freedoms and rights, and the separation of powers.
We hope that once the constitution is approved then the whole country will start preparing for its second elections which we hope will be free, and fair and we hope that many of our friends across the world will come to observe and monitor the elections to vouch for its veracity. we hope that all the different parties will be participating. One flower does not make a spring, that is why this election is very important to prove that the democracy process cannot be reversed.
Now I would like to speak quickly about the challenges that we face.
The first challenge is the economic/ social one. We all know that this factor was one of the main elements behind the revolution.
We are faced with many problems, the first is that people’s expectations are very high and their patience is very low. Also the economic situation in our main trading partners in Europe is affecting our exports and affecting tourism. Despite these problems the government has managed to reduce unemployment by 2% from 18 to 16%. Also growth went up from -2% when we took over to 3.5% for 2012 the number of tourists had also gone up and we received 6 million tourists last year.
However the young people who made the revolution in Sidi Bouzid and Kasserine have not seen any improvement in their lives and this is a challenge that will need many years to tackle.
The second challenge is the security challenge.  The revolution has weakened the state and it’s authority. This has given an opportunity to different groups to try to push the boundaries and cross the law. Extremists on both sides, whether on the religious right or on the extreme left have tried to impose their views with no respect to the law. We tell these groups that do not think for one moment that democracies are weak.
Slowly we are rebuilding the state’s authority but not on fear as it used to be under the dictatorship, but it will be based on the rule of law.
With regards to the Salafi issue, I would like to stress that this phenomena is first, the fruits of the Ben Ali regime and not the fruits of democracy.
Secondly, the phenomena is a complex one therefore it needs a complex solution. We see for example that this phenomena exists in the poor areas, therefore development needs to be part of the solution.
Also we need to know that this phenomena is diverse and that it’s not all violent. Therefore we need to push as many of the salafis away from violence in order to isolate the violent ones and make them a minority. This can be achieved through dialogue and through convincing them that their understanding of islam in wrong and that they need to work within the law if they want their full rights as citizens.
The third element in the solution is the security one: those who want or try to break the law or to impose their views on others with violence have to be dealt with severely. This is what the government has done over the last year by imprisoning hundreds of those who tried to break the law and regrettably in some instances also killing some of them in violent confrontations.
This security solution however, needs to be governed by the respect for human rights and rule of law and not as in the times of the dictatorship when all rights were disregarded.
The fall of the dictatorial regime in Tunisia was the spark that launched the Arab Spring. There is no doubt that the success of the Tunisian experience will lead to the promotion of this peaceful and democratic path. Tunisia has shown that the Arab Spring is not turning into a Fundamentalist Winter.
Today, we can assure you that it will not turn into a fundamentalist “religious” or “secular” winter but into a democratic spring where all have a place.
Regards

Zulkifli Hasan
Muscat, Oman
Muslims News
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June 7, 2013
DR. ZULKIFLI HASAN
Goldman Breaks Drought With Saudi Property Bond: Islamic Finance
Goldman Breaks Drought With Saudi Property Bond: Islamic Finance
By Samuel Potter Available at:
http://www.bloomberg.com/news/2013-06-05/goldman-breaks-drought-with-saudi-property-bond-islamic-finance.html
Goldman Sachs Group Inc. (GS), whose shariah-compliant bond program was questioned by Islamic scholars in 2011, led its first sukuk in more than three years after helping a Saudi property developer raise $450 million. The bank was a lead arranger on Dar Al Arkan Real Estate Development Co. (ALARKAN)’s sukuk on May 21, reforging links with the Riyadh-based real estate company after helping arrange the sale of its $450 million five-year bonds in February 2010.
The New York-based bank is seeking to catch up with U.S. competitors as demand accelerates for securities that conform to Islamic principles. Global sales reached a record $46.5 billion last year, according to data compiled by Bloomberg, while issuance has increased 4 percent to $18.3 billion in 2013. Citigroup Inc. (C) and Morgan Stanley (MS) are U.S. banks that have appeared among the global top 10 underwriters for Islamic bonds in the last five years, according to data compiled by Bloomberg.

“This is an area of growing importance as a source of funding” for borrowers, Martin Weber, head of debt capital markets for Europe Middle East & Africa growth markets at Goldman Sachs, said by phone yesterday. “Our presence in the region and connectivity with local issuers has gone up. You have seen us on Dar Al Arkan, and there is going to be more.”
Demand
Islamic financial assets could more than double by 2015 to as much as $3 trillion, Standard and Poor’s said in September. Emerging market sukuk have returned 0.3 percent this year, according to the HSBC/NASDAQ Dubai Sukuk Total Return Index. That compares with a loss of 1.9 percent for debt in Bloomberg USD Emerging Market Composite Bond Index. (BEM)

Dubai Electricity & Water Authority secured more than $5 billion of bids for the $1 billion of Islamic bonds it sold in February. Islamic Development Bank, the Saudi Arabia-based multinational lender, last week received $1.5 billion in bids for $1 billion of securities as it paid the lowest yield of the year.
“The Islamic industry is growing faster than conventional, so every financial institution is looking at it,” Afaq Khan, chief executive officer of Standard Chartered Saadiq, said by phone this week. “If clients are demanding Shariah-compliant solutions, you must develop accordingly.”
GE Sukuk
Goldman in 2009 helped arrange the sale of GE Capital’s $500 million Islamic bond, ranking it 24th on the list of global sukuk underwriters. The bank was 17th in 2010.

“International sukuk issues, which is where houses such as ours would historically add value, had better times three years ago,” said Weber.

Goldman has yet to issue from its own $2 billion sukuk program. The sukuk, blessed at the time by eight of the world’s top scholars, was criticized by some Islamic advisers for not ensuring the debt would be traded at par value as mandated by Islamic law. Advisers including Riyadh-based Mohammed Khnifer of Edcomm Group Banker’s Academy in New York also said it’s unclear how Goldman will use the funds it raises.

“A lack of product and industry knowledge could up-end the essence of Shariah-compliance,” Hatim El-Tahir, director of Deloitte’s Islamic Finance Knowledge Centre, said by e-mail this week. “It could threaten the risk-return profile of both industry and product.”
Growth Strategy
Banks “need to see a buoyant product, and right now that is sukuk,” Rizwan Kanji, Dubai-based partner at King & Spalding, said by phone this week. “That is what is driving these players.”

JPMorgan has hired a “big name” in Hussein Hassan, former global head of Islamic structuring at UBS AG (UBSN), which proves the bank’s commitment to the industry, Kanji said.

BofA Merrill Lynch was a lead manager as Asya Katilim Bankasi AS (ASYAB) raised $250 million in Tier 2, 10-year bonds on March 28. The issue was the first of its kind from Europe, Turkey or the Middle East, King & Spalding said. Kanji worked on the deal.

“BofA Merrill Lynch has done a lot of conventional issuance in Turkey,” said Kanji. “The bank has played to its strengths to build an Islamic platform.” Spokesmen for JPMorgan and BofA Merrill Lynch weren’t available for comment.
Increased competition in the industry could work in banks’ favor, said Standard Chartered (STAN)’s Khan, as lower fees increase the chances borrowers will come to market and more banks means a greater profile for the Islamic industry.

Forty-three banks have underwritten global sukuk sales this year, compared with 30 in the year-earlier period, according to data compiled by Bloomberg. Forty-four companies and governments have sold Islamic bonds, up from 36 in the year-earlier period.

“The more people we have talking about a product and Islamic solutions to their clients, the deeper the market becomes,” said Khan. “So while a few fees may go down, the absolute size of the market will increase.”
Regards

Zulkifli Hasan
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1

OVERVIEW OF MODERN FINANCIAL OVERVIEW OF MODERN FINANCIAL

MANAGEMENTMANAGEMENT

1111THTH JANUARY 2007JANUARY 2007

CONTENTSCONTENTS

• Introduction

• Conclusion

2

INTRODUCTIONINTRODUCTION
• Malaysia has a very unique legislative

framework consisting of mixed jurisdictions
and mixed legal systems namely the
common law and shariah.

• The growth and development of Islamic
banking industry are supported through
goods governance and its comprehensive
legal frameworks. As Malaysia is one of the
common law countries, it is very essential to
have standard law of practice, which
harmonizes both shariah and civil law. The
integration of these two traditions is really
necessary in the context of Islamic banking
in Malaysia.

SISTEM KEWANGAN DI MALAYSIA

PERBANKAN ISLAM

BANK KONVENSIONAL

PERBANKAN

SEKURITI HUTANG SWASTA/AWAM

PASARAN MATAWANG

BURSA SAHAM

DERIVATIVE

PASARAN MODAL

INSURAN ISLAM

INSURAN KONVENSIONAL

INSURAN

SISTEM KEWANGAN DI MALAYSIA

3

Reasons Reasons

• to develop harmony between
shariah and common law .

• The disputes will be heard in the Civil
court due to Schedule Nine, List 2 of
the Federal Constitution.

• A number of the existing laws which
are necessary for the Islamic
banking are in line with shariah
principles.

Process Process

• Dual Banking system and Moderate
approach

• Federal List

• Introducing the Islamic Banking Act
1983 and Section 124 Banking and
Financial Institutions Act 1989;

• Amendment and Review of Several
Relevant Legislations;

• Coordination amongst the
Authorities; and

• BNM’s Directives.

4

Dual Banking system & Moderate Dual Banking system & Moderate
approachapproach

• Malaysia decided to introduce dual
banking system whereby the existing
conventional banking is practiced side
by side with the Islamic banking
system.

• The development of Islamic banking
industry in Malaysia involved several
phases whereby Phase 1 started in
1983 until 1993 and Second Phases
began in 1994. Malaysia is now in the
midst of liberalizing its policy on the
implementation of Islamic banking so
as to enable us to lead the sector.

Federal ListFederal List

• Islamic banking was put under
Federal List since it refers to
commercial dealings although it
actually falls under the purview of
Islamic law.

• Thus, it is the parliament to pass
any law governing the Islamic
financial institutions.

5

IBA and BAFIAIBA and BAFIA

• The characteristics of IBA
creates flexibility to Islamic
financial institutions to operate
their business.

• BAFIA was then introduced
which allowed the conventional
banks to carry on Islamic
banking business.

• IBA and BAFIA require Islamic banks
to comply with the laws as well as
shariah.

Amendment and Review of Amendment and Review of
Several Relevant Several Relevant

LegislationsLegislations

• Examples:-

• the Central Banks Act 1958 (CBA)-
Shariah Committee’s Governance.

• Hire Purchase Act 1948- Muamalat
Hire Purchase Bill.

• the Stamp Act 1948. (Amendment)

6

CoCo--Ordination With Judicial Ordination With Judicial
BodyBody

• “There are no more than several dozen scholars with
the right combination of knowledge of Islamic law,
modern finance and technical English to serve on the
Shariah committees of institutions based around the
Gulf and beyond”.

• BNM with a cooperation of judicial body has agreed
to set up a special High Court in the Commercial
Division known as the Muamalah bench.

• According to Practice Direction No.1/2003, paragraph
2, all cases under the code 22A filed in the High
Court of Malaya will be registered and heard in the
High Court Commercial Division 4 and this special
high Court will only hear cases on Islamic banking.

BNMBNM’’ss DirectivesDirectives

• BNM has issued Guidelines on the
governance of Syariah Committee for
The Islamic Financial Institutions
(BNM/GPS 1) to regulate the
governance of the Shariah
Committee of Islamic financial
institution.

• a court may refer to the national
shariah advisory council of BNM on
any dispute involves shariah issues.

7

The Impact of The Impact of
HarmonisationHarmonisation

• From 1983 until 2004 the Islamic Banking
assets in Malaysia amounted to RM89
billion, accounting for 9.9 per cent of total
banking. Latest report: rm113.5 billion
(11%). In 2010- Target 20%.

• The implementation of muamalat bench
shows a positive result on the increasing
numbers of settled cases. From the
statistic, it shows that more than 75% out
of 656 cases has been settled by the court
from year 2003 to 2005.

• Cases Registered from 1.3.2003
– 1.12.2005=656

• Settled Cases from 1.3.2003-
1.12.2005=497

• Balance of Cases up to
1.12.2005=388

• Percentage of Settled Cases from
1.3.2003 – 1.12.2005=75.7%

8

CONCLUSIONCONCLUSION

• the main purpose of harmonization is
to develop harmony between shariah
and common law particularly in the
implementation of Islamic banking in
Malaysia.

• It is interesting to note that
harmonization is not always a
necessary.  The process of
harmonization is only applicable and
feasible to certain reasonable
differentials in selected area of shariah
and common law.

Thank You Thank You

Zulkifli Bin Hasan

Faculty Syariah and Law

Islamic University College of
Malaysia

E-mail: zul361977@yahoo.com

Tel. No: 06-7988 483

H/Phone No: 019-6698514