Malaysia also has in place the financial infrastructure and facilitative rules that contribute towards efficient price discovery and shorter time to market, thus providing an efficient platform for sukuk issuance and trading activities. The established legal, regulatory and Shariah framework in the Islamic financial infrastructure in Malaysia is reinforced by the supporting financial infrastructure, including the settlement and bond information system. To facilitate an efficient sukuk issuance process in Malaysia, an MIFC One-stop centre is being established as a single contact point for efficient delivery process to facilitate the issuance of sukuk. To further facilitate this process, there is no restriction on the ability to use international rating services, on the ability to hedge positions and on the ability to swap issuance proceeds into foreign currency. As part of our ongoing efforts to position Malaysia as an attractive gateway for the issuance of sukuk, a number of legal and regulatory requirements are further customised to reduce the cost of sukuk issuance. Profits and dividends received by non-resident investors from holding of ringgit and non-ringgit Islamic instruments issued in Malaysia are exempted from withholding tax. Special Purpose Vehicles (SPV) for Islamic financing purposes via the Islamic capital market are not subject to the administrative procedures under the Income Tax Act 1967. In addition, companies that establish these SPVs are given a tax deduction on the issuance cost of the Islamic securities incurred by the SPV. The issuance cost for all Islamic securities approved by the Securities Commission are also eligible for tax deduction.

Finally, there is a stamp duty exemption for 10 years on instruments relating to Islamic securities under the MIFC. Malaysia has also put in place an efficient platform for trading of bonds including the Realtime Electronic Transfer of Funds and Securities System (RENTAS), Fully Automated System for Issuance/Tendering (FAST), and Bond Information and Dissemination System (BIDS) to provide post-trade transparency and market liquidity on par with developed markets. Malaysia has a payment system link with Hong Kong Monetary Authority on US dollar settlements, while the Malaysian Government Securities are clearable with Clearstream. Finally, of importance is a conducive environment for innovation and this has been put in place. In 2006, the Malaysian market continued to generate innovative products with the launch of sukuk using Mudharabah, Musyarakah and Ijarah. Landmark issuance such as exchangeable sukuk Musyarakah by Khazanah Nasional Berhad, marked the world's first issue of its kind, incorporating full convertibility features common to conventional equitylinked transactions. An important enabling factor driving innovation is the availability of the pool of experienced talent. There are currently 9,000 staff with the Islamic financial institutions. They are also reinforced by the workforce of domestic and foreign conventional financial institutions. This expertise that resides in Malaysia allows for the development of innovative products so as to ensure that the product design and structure, as well as the risk management aspects that are being rigorously addressed.