An Introduction to Shari'ah Considerations in Bankruptcy and Insolvency Contexts and Islamic Finance's First Bankruptcy (East Cameron)

McMillen, Michael J. T.

doi:10.2139/ssrn.1826246

Cited by 7 publications

(3 citation statements)

References 4 publications

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“…Nevertheless, it is a necessity to realize that the bankruptcy petition mechanism is governed involuntary by the Islamic bankruptcy law which is different from the Western bankruptcy law petition that could be initiated with either a voluntary or involuntary mechanism . And it depends on the condition of the bankruptcy cases [15].…”

Section: An Overview Of Islamic Bankruptcy Lawmentioning

confidence: 99%

Adoption of Islamic Bankruptcy Law Values Into Indonesian Bankruptcy Law to Protect Good Faith Debtors

Robert¹,

Nasution²

2020

Proceedings of the International Conference on Law, Governance and Islamic Society (ICOLGIS 2019)

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This paper discusses the reasons of Islamic bankruptcy law values that should be adopted by Indonesia as a country with the world's largest muslim population. This study employs a qualitative research method by using secondary data. The results indicate that the current Indonesian bankruptcy law is not debtor friendly. The main problem of this issue is that Indonesian bankruptcy law does not distinguish the differences between a debtor who is not willing to fulfill his debts and a debtor who is unable to fulfill his debts. The Islamic bankruptcy law serves protection for people who are in debt as long as they have good faith It is suggested that the government amend the current bankruptcy law by adopting the Islamic bankruptcy law values into the national bankruptcy law. Therefore, the law would provide justice for the debtors in the future especially for those who are engaged in an Islamic economic activities.

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Section: An Overview Of Islamic Bankruptcy Lawmentioning

confidence: 99%

Adoption of Islamic Bankruptcy Law Values Into Indonesian Bankruptcy Law to Protect Good Faith Debtors

Robert¹,

Nasution²

2020

Proceedings of the International Conference on Law, Governance and Islamic Society (ICOLGIS 2019)

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“…Recent researches by Wijnbergen and Sajjad Zaheer (2013), Mcmillen (2011), Warde (2011) and Oseni (2013) have all discussed the issue of financial distress and Á sukūk default in Islamic finance. These studies have stressed the need for leading Islamic financial institutions to develop comprehensive Sharī'ah framework for solving the issue of insolvency and bankruptcy in Islamic finance space.…”

Section: Literature Reviewmentioning

confidence: 99%

Dana Gas Sukuk default: a juristic analysis of court judgement

Busari

Abdulaziz

Zakariyah

et al. 2019

IMEFM

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Purpose This study aims to analyse the facts of the case in the judgement made by the High Court of Justice, England, UK, in the case of Dana Gas Public Joint Stock Company (PJSC) v. Dana Gas Sukuk Limited (Ltd.) and Ors. Design/methodology/approach This study uses descriptive and juristic analysis to explain the factual terms in the case of Dana Gas sukuk default. It also uses juristic opinions to analyse the underpinning argument in the Dana Gas court case between the decision of Sharjah Court, UAE, and the English Court, UK. Findings The study concluded that despite the position of Dana Gas PJSC that specific element of the muḍārabah sukuk is non-Sharī’ah-compliant, the English court decision which established the enforceability of the purchase undertaking seems to be fair based on the Islamic maxims such as “Difficult situation cannot violate the right of other” and “The conditional matters among Muslims are binding.” Research limitations/implications The impact of this study is that Dana Gas sukuk default has thought stakeholders of Sukuk investment lessons on the importance of documentation and consideration of tighter clauses to ensure its bindingness in the law court. Hence, this study is expected to be a contribution towards the call for standardization of the role of Sharī’ah scholars across the globe. Originality/value This study illustrates the fact in the case of Dana Gas sukuk default and analyses the court’s decision from a fiqh perspective.

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“…Unfortunately, research in the area of Islamic bank resolution is very limited. Previous studies on insolvency and resolution of Islamic banks focus more on the failure of Islamic financial transactions, particularly sukuk rather than the institutions themselves (McMillen, 2012).…”

Section: Introductionmentioning

confidence: 99%

In search of sharia-compliant resolution framework for islamic banks: The case of Indonesia

Rulindo

Muhammad

2022

J. Eko. Keu. Isl.

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Purpose – This paper investigates Sharia concerns on existing bank resolution framework and propose recommendations on how to resolve those concerns in Sharia-compliant manners. It also assesses compatibility of resolution powers mandated by the FSB’s Key Attributes of Effective Resolution Regimes for Financial Institutions if applied to resolve failed Islamic bank, especially focusing on operational aspect of executing the resolution options. Methodology – We conduct a series of focus group discussion with various relevant stakeholders, including Indonesian Sharia scholars, regulators, professional associations, Islamic bankers and academics. The discussions were performed in group interviews format, with the authors took part as moderators. The discussions took place between July 2020 to January 2021, and were part of development of fatwa and regulations on the resolution for Islamic banks.Findings – In general, the existing bank resolution framework can be applied to Islamic banks. However, there are some resolution powers of the authority that possesses inherent sharia issues, but are still allowed according to Dewan Syariah Nasional (DSN) (the National Sharia Council). There should be clear measures attached to those powers prior to implementation. For some aspects, some adjustments to the resolution powers are also needed through establishment of infrastructures and regulations, particularly with regards to resolution options.Originality – The novelty of this study is the analysis of suitability of banking resolution issues from Sharia perspective. This paper also serves to enhance awareness on issues related to resolution of Islamic banks and promote wider implementation of Sharia approaches for bank resolution in other jurisdictions.

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An Introduction to Shari'ah Considerations in Bankruptcy and Insolvency Contexts and Islamic Finance's First Bankruptcy (East Cameron)

Cited by 7 publications

References 4 publications

Adoption of Islamic Bankruptcy Law Values Into Indonesian Bankruptcy Law to Protect Good Faith Debtors

Adoption of Islamic Bankruptcy Law Values Into Indonesian Bankruptcy Law to Protect Good Faith Debtors

Dana Gas Sukuk default: a juristic analysis of court judgement

In search of sharia-compliant resolution framework for islamic banks: The case of Indonesia

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