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Concept of islamic finance
Research topics on islamic capital market
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Legal documentation in Islamic Financial Transactions. Introduction The rapid growth of Islamic finance industry of the Islamic banking industry has been complemented and supported by an equally parallel comprehensive development in the legal infrastructure, integrating Shari, ah principles, legislation, and complex legal documentation matters. Thus, understanding these issues is very crucial for bankers and legal professional practicing in Islamic finance as a profession. As the Islamic finance industry keep expanding further, and become more innovative, keeping yourself updated on impending legal issues is of paramount importance. The Islamic finance industry has been focusing more on contract forms practiced in various financial transaction. Contract is a very essence of various transactions which without it may lead to void of legal significance. Islamic commercial law laid down comprehensive rules in leading to the creation of contract. We could see that Islamic commercial law is inspiring with many kinds of contracts that are beneficial to meet people’s need in different situations. The basic of transactions in Islam stresses in ethical, social and dimensions of financial transactions to improve equity and fairness for the general good of society. This perfect environment can be illuminate through the important verses in the Quran which stressed out the significance and how it enjoins believers to "keep faith contracts" (Awfu bi al-'Uqud), the formation of contract. According Nabil (1990) and Mohd (2008), there is no exact definition of a contract as such is to be found in the treatises of Islamic law until the 19th centuries. This is due to Islamic law never established a general theory of contract, thus ... ... middle of paper ... ...ion using legal terms may confuse even both parties. Hence, it is the customer rights to ask for financier help to understand the whole agreement before signing it, this is essential to avoid any possibility of dispute in the future between both contracting parties. The client should be given enough time to understand the legal documentation first before making any decisions. All these need to be taken into consideration to ensure the legal documentation is align with Shariah principles. It is also our hope that a holistic application of the Shariah, shall affirm Islamic banks to ensure the use of propety is Shariah-compliant particularly in view of the inherent reputational risk in Islamic transactions and governance. Besides, the Islamic legal documentation should reflect the Islamic commercial law and potrays its maqasid al-Shariah or objective of Shariah.
Contracts are legally enforceable promises. There are two requirements for contract formation: agreement and consideration. An agreement involves a valid offer being made by an offeror to an offeree and said offer being validly accepted by the offeree and communicated to the offeror. The second requirement is consideration, meaning the two parties exchange something of legal value. Contracts serve the purpose of ensuring stability, predictability, and certainty, as well as deterring defection, in business dealings. The objective theory of contract law states that only the language of the contract should be considered in contract interpretation. This theory ignores entirely the intent of the parties. However, contract law is largely
Islamic Legal Studies Program, Harvard Law (2004). Web. The Web. The Web. 5 Nov. 2013 Norland, Ron, and Alissa Rubin.
Islamic law may be hard to understand from a western perspective. There are many similarities, such as the way trials convene, but also many differences. The structure of Islamic Law and what they base their law on is vastly different than our own. In this essay, I am going to cover some of the major topics of Islamic Law. This includes Sharia, and how laws are derived from it. What is Fatwa, and why it is needed. How family practice law works and how it pertains to women. I will then finish with Islamic jurisprudence. Let us begin with Sharia.
1.1 Explain at least four points of differentiations between contract and agreement with the help of examples.
HILLIARD, J. And O’SULLIVAN, J. (2012) The Law of Contract [Online] 5th Ed. Oxford: Oxford University Press. Available from - http://books.google.co.uk/ [Accessed: 2nd January 2014]
This judgment given set criterion which is still been used in the modern court system and due to this case it was developed that an offer of contract can be unilateral and doesn’t have to be made to a specific party only. Also it was developed to that the acceptance of an offer does not require a notification and that once the concerned party purchases the product the contract is active then and there itself. And it was also established that purchase of an item is a fine example of consideration and therefore makes it a valid contract. (Smith, 2000).
The modern Islamic Finance industry is young, its timeline begin only a few decades ago. However, islamic finance is involving rapidly and continues to expend to serve a growing population of muslims as well as conventional.
Friend, Celeste. "Social Contract Theory [Internet Encyclopedia of Philosophy]." Internet Encyclopedia of Philosophy. Hamilton College, 15 Oct. 2004. Web. 01 Oct. 2011. .
The basic law of a contract is an agreement between two parties or more, to deliver a service or a product. And reach a consensus about the terms and conditions that is enforced by law and a contract can be only valid if it is lawful other than that there can’t be a contract. For a contract to exist the parties must have serious intentions, agreement, contractual capacity meaning a party must be able to carry a responsibility, lawful, possibility of performance and formalities. Any duress, false statements, undue influence or unconscionable dealings could make a contract unlawful and voidable.
There are a number of features or principles which are attributable to the Mudarabah contract. These include nature of contract, capital, profit sharing right and treatment of losses.
This paper would analyze the different types of bank guarantee, i.e., conditional and unconditional bank guarantee and would also highlight the differences between general guarantee as defined under Section 126 of the Indian Contract Act, 1872 and a bank guarantee. It would also delve into the discussion about the conditions under which the courts would grant injunctions restraining a bank from enforcing a bank guarantee. Alongside, this paper would also bring to light the significant difference between the Indian law and the common law in relation to the way they deal with injunction of bank guarantee.
A contract is an agreement between two parties in which one party agrees to perform some actions in return of some consideration. These promises are legally binding. The contract can be for exchange of goods, services, property and so on. A contract can be oral as well as written and also it can be part oral and part written but it is useful to have written contract otherwise issues can be created in future. But both the written as well as oral contract is legally enforceable. Also if there is a breach of contract, there are certain remedies for that which are discussed later in the assignment. There are certain elements which need to be present in a contract. These elements are discussed in the detail in the assignment. (Clarke,
As the world has recently passed through the global financial crisis that begun in 2008 in the USA with the banks’ collapsing, analysts are giving different opinions and making new economic hypothesizes about the origin of, as well as the process of different countries escaped from the crisis. Among all these new “theories”, the case of Islamic banks is interesting in terms of its nature and consequences. In my essay, I will try to highlight the basic principles of the Islamic finance, the reasons of the restriction of interest, the most important tools used by Islamic banks in economic activities and brief explanation of them, and finally my view point of the probable future improvement of the Islamic financial system.
Mutual consent of parties is the basis of formation of contract. The Prophet stated that “It is unlawful
A contract is generally considered to be an exchange of promises or an agreement between parties which in due course legally binds the parties; this can be enforced by the English Law. A contract is always, referred to the basic foundations of Contract Law, which refers to promises being kept amongst two parties. It is clear that all people make contracts nowadays and do not even consider for a moment that they are forming contracts; these can be formal or informal, oral or written.