| Summary: |
Islamic financial law (IFL), an emerging global legal order, is a highly fragmented law comprised of both state and non-state generated laws, standards, commercial practices, institutions, fatwās and legal ideas. A recent event involving ṣukūk issuance in which Dana Gas claimed that its ṣukūk were no longer Sharīʿah-compliant highlights the legal disjuncture between global IFL and the laws of municipal legal systems, which have chosen to facilitate and regulate Islamic finance. Systemic legal issues or ‘legal gaps’ undermine investor confidence and impede sustainable development of the Islamic finance industry. Legal gaps include but are not limited to undeveloped securities laws, enforceability issues and a lack of clarity with respect to the role and effect of the Sharīʿah in the municipal legal systems of many MENA (Middle East/North Africa) states. This paper analyses these gaps and in so doing illustrates the relationship of IFL to the law of the United Arab Emirates.
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