The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework

Purpose: This paper aims to thoroughly examine the extent to which the current legal and regulatory framework is inclusive towards Islamic banking and finance (IBF) practices in the attempts to introduce IBF as a significant component in the Mozambique’s financial system. This is achieved by providi...

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Main Authors:	Modan, Carino, Hassan, Rusni
Format:	Article
Language:	English English English
Published:	Emerald Group Publishing Ltd. 2018
Subjects:	HG3368 Islamic Banking and Finance
Online Access:	http://irep.iium.edu.my/65245/ http://irep.iium.edu.my/65245/ http://irep.iium.edu.my/65245/ http://irep.iium.edu.my/65245/1/65245_The%20possible%20inclusion%20of%20legal%20provisions%20in%20Islamic%20banking%20and%20finance.pdf http://irep.iium.edu.my/65245/2/65245_The%20possible%20inclusion%20of%20legal%20provisions%20in%20Islamic%20banking%20and%20finance_SCOPUS.pdf http://irep.iium.edu.my/65245/13/65245_The%20possible%20inclusion%20of%20legal%20provisions_WOS.pdf

id	iium-65245
recordtype	eprints
spelling	iium-652452018-08-21T02:27:53Z http://irep.iium.edu.my/65245/ The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework Modan, Carino Hassan, Rusni HG3368 Islamic Banking and Finance Purpose: This paper aims to thoroughly examine the extent to which the current legal and regulatory framework is inclusive towards Islamic banking and finance (IBF) practices in the attempts to introduce IBF as a significant component in the Mozambique’s financial system. This is achieved by providing a critical review on the Mozambican current legal and regulatory framework including the court and arbitration system, as well as the country’s financial institutions law and regulations. Design/methodology/approach: The methodology used in this study is the qualitative approach. The analysis made is based on descriptive and analytical approach whereby the study examined and critically analysed the banking regulations in Mozambique with the purpose of finding the legal gap in the existing legal and regulatory framework that allows the introduction of IBF in the country. Findings: This study finds that whilst some legal provisions in the current legal and regulatory framework are conflicting with the Sharï’ah principles such as the definition of loans and the concept of interest, there is also a certain number of enabling features that can be immediately explored, including deposits (with no interest), leasing operations, investment funds or venture capital. Research limitations/implications: At present, to the best of the authors’ knowledge, this is the first attempt ever made to assess the compatibility of the existing Mozambican commercial laws with the Islamic principles hence identifying the challenges that might arise due to the implementation of IBF practices in Mozambique. Practical implications: This paper has several practical implications in the sense that it helps the financial market authorities in Mozambique to be able to foresee possible inclusion of provisions on Islamic transactions in the country’s existing financial regulations. Social implications: The contributions of this paper lie in the valuable recommendations made on the insertion of Islamic principles in the current regulatory framework as well as assisting in overcoming some of the conflicting aspects in medium to long term. Mozambique should explore and benefit from the experience and lessons learned by the neighbouring countries that have successfully adopted the IBF practice. It is recommended that the Central Bank should establish a “task force team”, comprising of multi-skilled professionals and experts in Islamic finance from various internal areas ranging from licensing to supervision together with Sharï’ah scholars and representatives from the Muslim Community, to study the required process for adoption of IBF in the country. Originality/value: There is no other study on IBF in Mozambique, particularly on legal and regulatory aspects. Emerald Group Publishing Ltd. 2018 Article PeerReviewed application/pdf en http://irep.iium.edu.my/65245/1/65245_The%20possible%20inclusion%20of%20legal%20provisions%20in%20Islamic%20banking%20and%20finance.pdf application/pdf en http://irep.iium.edu.my/65245/2/65245_The%20possible%20inclusion%20of%20legal%20provisions%20in%20Islamic%20banking%20and%20finance_SCOPUS.pdf application/pdf en http://irep.iium.edu.my/65245/13/65245_The%20possible%20inclusion%20of%20legal%20provisions_WOS.pdf Modan, Carino and Hassan, Rusni (2018) The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework. International Journal of Law and Management, 60 (2). pp. 662-680. ISSN 1754-243X E-ISSN 1754-2448 https://www.emeraldinsight.com/doi/pdfplus/10.1108/IJLMA-10-2016-0097 10.1108/IJLMA-10-2016-0097
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English English English
topic	HG3368 Islamic Banking and Finance
spellingShingle	HG3368 Islamic Banking and Finance Modan, Carino Hassan, Rusni The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework
description	Purpose: This paper aims to thoroughly examine the extent to which the current legal and regulatory framework is inclusive towards Islamic banking and finance (IBF) practices in the attempts to introduce IBF as a significant component in the Mozambique’s financial system. This is achieved by providing a critical review on the Mozambican current legal and regulatory framework including the court and arbitration system, as well as the country’s financial institutions law and regulations. Design/methodology/approach: The methodology used in this study is the qualitative approach. The analysis made is based on descriptive and analytical approach whereby the study examined and critically analysed the banking regulations in Mozambique with the purpose of finding the legal gap in the existing legal and regulatory framework that allows the introduction of IBF in the country. Findings: This study finds that whilst some legal provisions in the current legal and regulatory framework are conflicting with the Sharï’ah principles such as the definition of loans and the concept of interest, there is also a certain number of enabling features that can be immediately explored, including deposits (with no interest), leasing operations, investment funds or venture capital. Research limitations/implications: At present, to the best of the authors’ knowledge, this is the first attempt ever made to assess the compatibility of the existing Mozambican commercial laws with the Islamic principles hence identifying the challenges that might arise due to the implementation of IBF practices in Mozambique. Practical implications: This paper has several practical implications in the sense that it helps the financial market authorities in Mozambique to be able to foresee possible inclusion of provisions on Islamic transactions in the country’s existing financial regulations. Social implications: The contributions of this paper lie in the valuable recommendations made on the insertion of Islamic principles in the current regulatory framework as well as assisting in overcoming some of the conflicting aspects in medium to long term. Mozambique should explore and benefit from the experience and lessons learned by the neighbouring countries that have successfully adopted the IBF practice. It is recommended that the Central Bank should establish a “task force team”, comprising of multi-skilled professionals and experts in Islamic finance from various internal areas ranging from licensing to supervision together with Sharï’ah scholars and representatives from the Muslim Community, to study the required process for adoption of IBF in the country. Originality/value: There is no other study on IBF in Mozambique, particularly on legal and regulatory aspects.
format	Article
author	Modan, Carino Hassan, Rusni
author_facet	Modan, Carino Hassan, Rusni
author_sort	Modan, Carino
title	The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework
title_short	The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework
title_full	The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework
title_fullStr	The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework
title_full_unstemmed	The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework
title_sort	possible inclusion of legal provisions in islamic banking and finance: the case study of the mozambican regulatory framework
publisher	Emerald Group Publishing Ltd.
publishDate	2018
url	http://irep.iium.edu.my/65245/ http://irep.iium.edu.my/65245/ http://irep.iium.edu.my/65245/ http://irep.iium.edu.my/65245/1/65245_The%20possible%20inclusion%20of%20legal%20provisions%20in%20Islamic%20banking%20and%20finance.pdf http://irep.iium.edu.my/65245/2/65245_The%20possible%20inclusion%20of%20legal%20provisions%20in%20Islamic%20banking%20and%20finance_SCOPUS.pdf http://irep.iium.edu.my/65245/13/65245_The%20possible%20inclusion%20of%20legal%20provisions_WOS.pdf
first_indexed	2023-09-18T21:32:35Z
last_indexed	2023-09-18T21:32:35Z
_version_	1777412609168900096

The possible inclusion of legal provisions in Islamic banking and finance: the case study of the Mozambican regulatory framework

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