Malaysia has once again proven itself to be a leading player in the Islamic banking and financial market. On June 30, 2013, another building block was added to the regulatory structure: the Islamic Financial Services Act 2013 (IFSA). The IFSA provides for “regulation and supervision of Islamic financial institutions, payment systems and other relevant entities and the oversight of the Islamic money market and Islamic foreign exchange market to promote financial stability and compliance with Shariah”. To local as well as international industry players, the IFSA symbolises the effort and commitment of the Malaysian government to enhance and develop its legal infrastructure in order to accommodate the dynamic growth of the Islamic banking and finance industry. A similar commitment was shown prior to IFSA where a number of pieces of legislation were enacted and modified to cater for the Islamic banking and finance industry: the Islamic Banking Act 1983, the Central Bank Act 2009 and the Government Investment Act 1983. Compared to its predecessors, the IFSA gives more focus on enforcing closer adherence to the Shariah. Due to the importance of Shariah adherence, this article examines the extent of Shariah inclusivity taking into consideration its application in Malaysian judicial system.
