IRP 40 – Fatwas On Islamic Capital Markets: A Comparative Study Between Malaysia And Gulf Co-Operation Council (GCC) Countries

The Islamic banking industry has experienced rapid growth, notably in Southeast Asia and the Middle East. However, after four decades in operation, the two regions have diverged over Shariah resolutions. The former is said to have adopted a more lenient and flexible approach as compared to the latter. The present paper examines this issue by analysing fatwas issued by Malaysian Shariah scholars and their GCC counterparts. The discussion focuses on fatwas related to the Islamic capital market. The fatwas are analysed based on resolutions made by the Shariah advisors of the Malaysian Securities Commission, Kuwait Finance House, the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI), the International Islamic Fiqh Academy, Dubai Islamic Bank and Dallah al-Baraka Group. The study is pertinent to bridging the gap related to Islamic banking practices in various Muslim countries by advocating the harmonisation of Shari’ah rulings.

Keywords: fatwa, Islamic banking, Malaysia, Gulf Cooperation Council (GCC)