MFSA Sets up Expert Group on Islamic Finance
21/07/2009
Following
the consultation conducted by the MFSA with respect to the
introduction of Islamic Finance in Malta, the local regulator
has set up an expert group in order to identify and discuss the
regulatory changes which need to be introduced into local
legislation in order to position Malta as an ideal jurisdiction
for the set up of Sharia compliant funds, credit institutions
and other financial services providers.
The expert group will discuss changes necessary to local
legislation as well as any amendments which need to be
introduced in the context of local financial services
regulation. The expert group will also propose new legislation
and regulation where it deems fit.
The Islamic economic model is built upon the principle of
fairness, and while recognizing the importance of the creation
of wealth, emphasizes social justice and ethical behaviour. The
Islamic model thus prohibits usury, the collection and payment
of interest, and investment in endeavours which are contrary to
Islamic values, such as pornography and alcohol.
While some of the values held by Islamic Finance are known to
the local regime, embracing familiar notions of ‘ethical
investment’, the manner in which Sharia compliant transactions
are structures necessitates a number of changes to Maltese law
in order for the jurisdiction to be optimal for such endeavours.
The efforts conducted by the local authorities will ensure that
the country is well placed to serve as a domicile of choice for
Islamic Finance in the near future.
