A guide to PLC Finance's Islamic finance resources
This note acts as a guide to PLC Finance's resources on Islamic finance.
For an introduction to the basic principles of Islamic law (or Sharia (www.practicallaw.com/9-500-7092)) that affect finance transactions and a description of the main Sharia-compliant transaction structures together with an explanation of how they are used in practice (giving a brief outline of some of the documents used), see Practice note, Islamic finance: UK law overview (www.practicallaw.com/3-366-1996).
For a very general introduction to some of the basic concepts that occur in Islamic finance transactions and definitions of some of the widely used Islamic finance products, see Practice note, Introduction to Islamic finance (www.practicallaw.com/5-202-0621).
Sukuk (singular sakk) are financial instruments, such as certificates, which represent an undivided ownership share in an underlying asset or interest held by the issuer. This distinguishes them from both conventional bonds (which represent debt obligations of the issuer) and conventional equities (which represent ownership interests in the issuer itself). The basic principle is that an ownership share in the underlying asset entitles the sakk holder to a proportionate share of the returns generated by the asset. The overall economic effect is similar to a conventional bond.
For a brief introduction to sukuk see Practice note, Islamic finance: UK law overview: Sukuk (www.practicallaw.com/3-366-1996)
For an introduction to the characteristics Islamic financial instruments need to have in order to be considered to be Sharia compliant see Article, AAOIFI Statement on Sukuk and its Implications (www.practicallaw.com/7-500-9431).
For an introduction to some of the issues surrounding the development of Islamic derivatives and an outline of some of the key structures, see Practice note, Islamic derivatives (www.practicallaw.com/8-501-6191).
For an overview of the impact of Islamic finance on microfinance (www.practicallaw.com/5-386-3106) see Practice note, International investment in microfinance: overview: Islamic finance (www.practicallaw.com/8-385-9099).
For an overview of Islamic project finance from an international perspective, see Article, Islamic Project Finance (www.practicallaw.com/3-501-3312).
For an analysis of how the English courts will interpret requirements to act in accordance with the Sharia, see Practice note, Sharia and the English courts (www.practicallaw.com/0-507-2195).
For an introduction to standard documentation for Sharia-compliant transactions and links to online resources, see Practice note, Islamic finance: standard documents (www.practicallaw.com/6-500-6292).
For an outline of the contractual structure used for a Sharia-compliant forward financing transaction, see Deal structure: Islamic finance - Bai salam (www.practicallaw.com/8-368-5018).
For an outline of the contractual structure used for a Sharia-compliant product similar to a conventional finance lease, see Deal structure: Islamic finance - Ijara (www.practicallaw.com/6-368-5019).
For an outline of the contractual structure used for a Sharia-compliant construction or manufacturing financing, see Deal structure: Islamic finance - Istisna'a (www.practicallaw.com/4-368-5020).
For an outline of the contractual structure used for a Sharia-compliant profit sharing arrangement, see Deal structure: Islamic finance - Mudaraba (www.practicallaw.com/2-368-5021).
For an outline of the contractual structure used for a Sharia-compliant commodity trading arrangement, see Deal structure: Islamic finance - Murabaha (www.practicallaw.com/0-368-5022).
For an outline of the contractual structure used for another Sharia-compliant commodity trading arrangement, see Deal structure: Islamic finance - Reverse murabaha (tawarruq) (www.practicallaw.com/6-368-5024).
For an outline of the contractual structure used for a Sharia-compliant equity and venture capital financing, see Deal structure: Islamic finance - Musharaka (www.practicallaw.com/8-368-5023).
For an outline of the contractual structure used for a Sharia-compliant form of security similar to a bond in which the underlying lease generates the return, see Deal structure: Islamic finance - Sukuk al ijara (www.practicallaw.com/3-368-5025).
For an outline of the contractual structure used for a Sharia-compliant form of security similar to a bond in which a Sharia-compliant joint venture generates the return, see Deal structure: Islamic finance - Sukuk al musharaka (www.practicallaw.com/1-368-5026).
For an outline of the contractual structure used for a Sharia-compliant form of security similar to a bond in which a Sharia-compliant contractual investment arrangement between an investor (Rab al Maal) and a managing trustee (Mudareb) and in which profits are shared provides the return. See Deal structure: Islamic finance - Sukuk al mudaraba. (www.practicallaw.com/8-501-7633)
For an outline of the contractual structure used for a Sharia-compliant form of security similar to a bond in which a Sharia-compliant commodity trading arrangement structure provides the return. See Deal structure: Islamic finance - Sukuk al murabaha (www.practicallaw.com/8-502-0032).
For an outline of the contractual structure used for a Sharia-compliant form of security similar to a bond in which a Sharia-compliant an underlying forward financing transaction (where the financial institution pays in advance for buying specified assets, which the seller will supply on a pre-agreed date) provides the return. See Deal structure: Islamic finance - Sukuk al salam (www.practicallaw.com/6-502-0033).
For an outline of the contractual structure used for a Sharia-compliant form of security similar to a bond in which a Sharia-compliant investment fund (in which the investment of the funds is undertaken by the investment agent) generates the return. See Deal structure: Islamic finance - Sukuk al wakala. (www.practicallaw.com/9-501-7637)
For an introduction to the UK's tax treatment of Islamic finance or, as it is referred to in UK tax legislation, "alternative finance", see PLC Tax, Practice note, Sharia-compliant transactions: tax (www.practicallaw.com/4-201-9755).
For a consideration of the UK VAT treatment of certain sharia-compliant financing structures, see PLC Tax, Practice note, Sharia-compliant transactions: VAT (www.practicallaw.com/0-376-4477).
Links to PLC Finance resources on Islamic finance:
Links to PLC services covering key practice areas relevant to Islamic finance transactions:
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