Final ib pptx

ISLAMIC LAW SYSTEMS

BYGROUP NO 8.

• ABHEY BANSAL (001)• HARSH GADA(022)• SHIRISH SHITOLE(052)

1ISLAMIC LAW SYSTEMS

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Countries adopting Islamic Law Country Legal System

Afghanistan mixed legal system of civil, customary, and Islamic law

Bahrain mixed legal system of Islamic law and English common law

Algeria mixed legal system of French civil law and Islamic law

Bangladesh mixed legal system of mostly English common law and Islamic law

Brunei mixed legal system based on English common law and Islamic law

Egypt mixed legal system based on Napoleonic civil law and Islamic religious law



Iraq mixed legal system of civil and Islamic law

Jordan mixed legal system of civil law and Islamic religious law

Kenya mixed legal system of English common law, Islamic law, and customary law

Kuwait mixed legal system consisting of English common law, French civil law, and Islamic religious law

Malaysia mixed legal system of English common law, Islamic law, and customary law

Oman mixed legal system of Anglo-Saxon law and Islamic law



Pakistan common law system with Islamic law influence

Qatar mixed legal system of civil law and Islamic law (in family and personal matters)

Saudi Arabia Islamic (sharia) legal system with some elements of Egyptian, French, and customary law

United Arab Emirates mixed legal system of Islamic law and civil law

Source : https://www.cia.gov/library/publications/the-world-factbook/fields/2100.html5ISLAMIC LAW SYSTEMS

Shari’a• Shari’a : “Path to a watering hole”• Theocratic Law System.• Moral code and religious law of Islam.• Derived from 2 primary sources of Islamic Law

– The precepts set forth in the Quran– Example set by the Islamic prophet MuhammadDeals


Shari’a• Sharia law can be organized in different ways

– ibadah (ritual worship)– mu'amalat (transactions and contracts)– adab (morals and manners),– i'tiqadat (beliefs)– ‘uqubat (punishments).


Islamic Banking

• Form of modern banking based on Rules of Sharia, known as Fiqh al-Muamalat (Islamic rules on transactions)

History of Islamic Banking

• The first Islamic bank in Mit Ghamr, Egypt in 1963 by Ahmad El Naggar

• Islamic Development Bank (IDB) in 1974

• First Islamic commercial bank “Islamic Bank of Dubai” in 1975

Importance of Islamic Banking

• Muslim population at about 2.1 billion, representing a sizeable 30 percent of the world population of 7 billion.

• Market shares of Islamic deposits and financing stand at 15.6 percent and 11.6 percent of the industry’s total.

• Total assets managed through Islamic equity funds exceed US$5oo billion and is growing by 12–15% per annum.

Principals of Islamic Banking

• Riba: Arabic word which stands for excess, increase, addition, expansion or growth

• Ghrar : speculative Investments like in derivatives are not allowed

• Haram :Prohibits investment in gambling and alcohol and other industries.

Difference between Islamic and Conventional Banking

• Islamic banking : On Shariah foundation while the conventional banking does not.

• Relationship between customer and the bank Islamic bank: Customers as a partner rather than a borrower as in conventional banking

• Prohibition of Riba• Syariah Supervisory Board In Islamic banking

while Convention Bank can conduct its business operation at its own

Common Concepts

• Profit sharing (Mudharabah) • Joint venture (Musharakah)• Leasing (Ijarah)• Sukuk (Islamic bonds)• Takaful (Islamic insurance)• Qard hassan/ Qardul hassan (good

loan/benevolent loan)

Islamic Banking in Nigeria

• Nigeria : Conglomeration of religions and ethnicities. 50% Muslim, 40% Christian

• The Central Bank of Nigeria (CBN) issued new guidelines in accordance with the provisions of Banks and Other Financial Institutions Act (BOFIA) for the operation of Non-interest banking in Nigeria.

Major Islamic banks in World

Source: www.panafricancapitalplc.com

http://www.panafricancapitalplc.com/

Islamic Banking In India

• Islamic banks in India do not function under banking regulations. They are licensed under Non Banking Finance Companies Reserve Bank Directives RBI (Amendment) Act 1997, and operate on profit and loss based on Islamic principles.

• All the Islamic banks have to be compulsorily registered with RBI.

• First bank in Kerala

Implications and Opportunities of Non-interest (Islamic) Banking

• Large number of unbanked Muslim community may be attracted to this type of specialized banking system and get bankable.

• People to have different credit choice among different types of banking structures

• Encourages Muslim communities to invest locally rather than sending their investment to the Middle-East

Selection Criteria Of Islamic Banking For MNEs

• Convenience: Working hours of ATMs, convenient branch locations and wide branch network convenience

• Cost and benefit• Influence by friends and relatives• No influence of religion

Legal system in UAE• UAE : Federation of 7 Emirates

• Dubai, Abu Dhabi, Ajman, Fujairah, Ras Al Khaimah, Sharjah and Umm Al Quwain.

• UAE : Dubai’s legal system is founded upon• Civil Law Principles• Islamic Shari’a law

• Civil Law Principles : Legislation tends to be formulated into a number of major codes providing for general principles of law with a significant amount of subsidiary legislation.

• Islamic Shari’a Law : More administrative in nature, such as the establishment and operation of government affiliated entities.


Court System in UAE

• Court of First Instance

• Court of Appeal

• Court of Cassation

• Labour Court


Court of First Instance• Largest court within the Abu Dhabi Judicial

Department in terms of size, divisions and diversity of jurisdiction.

• Consists of 3 main sections and their sub sections– Civil Section : Deals with civil, commercial,

administrative, labour and summary cases.– Civil status Cases Section : Deals with family,

inheritance, documentation and proclamations and family guidance.

– Criminal Cases Section : Deals with criminal offences


Court of Appeal• Higher Courts • Look into appeals from appellants challenging

the decisions of a first instance court.• Consists of

– Civil – Commercial– Labour – Personal Status– Criminal – Administrative


Court of Cassation• Highest Judicial Institution in Emirate.• Looks into appeals challenging the rulings of

the appellate courts• Consists of 5 divisions

– Criminal– Commercial– Civil– Personal Status– Administrative

• Judgments of Cassation court are binding.25ISLAMIC LAW SYSTEMS

Implication for MNE’s

• This slide can go in the conclusion part for Harsh

• I will tell you what to say or add…

ISLAMIC LAW SYSTEMS 26

Indonesia• Area: 2 million sq. km. • Population (July 2009 est.): 240.3 million• Ethnic groups (2000 census): - Javanese 40.6%- Sundanese 15%- Madurese 3.3%- Minangkabau 2.7%- others 38.4%

Indonesia• Religions (2000 census): - Muslim 86.1%- Protestant 5.7%- Catholic 3%- Hindu 1.8%- others 3.4%.

Indonesia• Pancasila (Constitution: 1945)- Monotheism- Humanitarianism- National Unity- Representative democracy by consensus- Social Justice

Netherlands Indies• Roman-Dutch law, custom and Islamic law.

Under Dutch (Netherlands Indies) population was divided into Europeans, Natives, and Foreign Orientals

• Indonesians subject to adat law• Netherlands East Indies divided into several

jurisdictions based on cultural and linguistic criteria.

• First legislation relating to application of Islamic law was 1882 Royal Decree

Netherlands Indies• Independence declared • Enactment of Muslim Marriage and Divorce

Registration Law 1946• New Marriage Law applicable to all

Indonesians eventually passed in 1974• Marriage Law is applied by - regular court system for religious minorities- sharia courts for Muslim Indonesians.

Indonesia• School(s) of Fiqh• Constitutional Status of Islam(ic Law)• Court System- General- Religious- Military- Administrative courts• Relevant Legislation• Notable Features

Unilever Indonesia• 1920 -30: Import by Jurgen and Brothers• 1933: Soap Factory at Jakarta• 1936: Margarine and oil production at Jakarta• 1941: Cosmetics factory at Surabaya• 1942 -46: Unilever control discontinued

(World War II)• 1965 -66: Under government control• 1967: Control of business back to Unilever

under foreign investment law

Unilever Indonesia• 1981: Went public and listed in Jakarta Stock

Exchange• 1982: Construction of Elida Gibbs Factory in

Rungkut, Surabaya• 1988: Transfer of the Toilet Soap Factory from

Colibri to Rungkut Factory, Surabaya• 1990: Enter into the tea business• 1992: Opening of ice cream factory• 1995: Construction of detergents and foods

factory in Cikarang, Bekasi

Unilever Indonesia• 1996-98: Consolidation of manufacturing

facilities – Cikarang, Rungkut• 1999: Liquid Detergents – Cikarang• 2000: Enter into soya sauce business• 2001: Opening of tea factory – Cikarang• 2002: Opening of CDC at Jakarta• 2003: Enter into mosquito coil business• 2004: Enter into snack business• 2005: Liquid / shampoo factory at Cikarang • 2008: Fruit-based vitality drinks business

MNEsCOMPANY RANK COUNTRY

REVENUE 2009 US$ (ml)

Saudi Arabian Oil Co. (Saudi Aramco) 1

1 Saudi Arabia $182,396

National Iranian Oil Company 1 2 Iran $79,277

Petroliam Nasional Bhd. (Petronas)

3 Malaysia $70,869

Kuwait Petroleum Corp. 1 4 Kuwait $50,404

Sonatrach 5 Algeria $47,980

PT Pertamina (Persero) 1 6 Indonesia $34,678

Qatar Petroleum 7 Qatar $32,421

Nigerian National Petroleum Corp. 1

8 Nigeria $30,890

Abu Dhabi National Oil Co. 1 9 UAE $30,849

Koc Holding A.S. 10 Turkey $28,978

Saudi Basic Industries Corporation (SABIC)


National Oil Company (NOC) 1 12 Libya $24,636

Saudi Telecom Company 13 Saudi Arabia $13,544

KazMunayGas 14 Kazakhstan $13,441

The Emirates Group 15 UAE $12,362

Sabanci Holding 16 Turkey $12,181

Astra International 17 Indonesia $10,935

Yildiz Holding/ Ulker 18 Turkey $10,900

Isbank 19 Turkey $10,897 Pakistan State Oil Co. 20 Pakistan $10,208

Sime Darby Bhd 21 Malaysia $10,019

Perusahaan Listrik Negara, PT 22 Indonesia $10,002

Iranian Mining Industries (IMIDRO) 2

23 Iran $9,811

Ziraat Bank 24 Turkey $9,805

Iran Khodro Plc 26 Iran $9,089

Emirates Telecom (Etisalat) 27 UAE $8,394

(Zain) Mobile Telecommunications Co.

28 Kuwait $8,056

Saudi Oger Co. 29 Saudi Arabia $8,000

Egyptian General Petroleum Co. (EGPC) 1

30 Egypt $7,738

Akbank 31 Turkey $7,441

Petroleum Development Oman (PDO) 1

32 Oman $7,385

Telkom Indonesia 33 Indonesia $7,203

National Iranian Petrochemical Company

34 Iran $7,192

Dogan Holding 35 Turkey $6,607

Saudi Electric Company 36 Saudi Arabia $6,360

Maybank Group 37 Malaysia $5,999

Agility 38 Kuwait $5,723

ETA - Ascon Group 39 UAE $5,690

TurkCell 40 Turkey $5,492

Saipa Corporation 2 41 Iran $5,462

YTL Corporation Berhad 42 Malaysia $5,373

SOCAR (State Oil Company of the Azerbaijan Republic)

43 Azerbaijan $5,260

Dallah Albaraka Group 2 44 Saudi Arabia $5,204

Enka Holdings 45 Turkey $5,124

Orascom Telecom 46 Egypt $5,065

DOGUS Holding Co. 47 Turkey $5,011

Halkbank 48 Turkey $5,010

Saudi Binladin Group 2 49 Saudi Arabia $5,000 The Lion Group 50 Malaysia $4,907 Tenaga Nasional Bhd 25 Malaysia $9,798

182390 Million USD

MNEsVakif Bank 51 Turkey $4,802

Savola Group 52 Saudi Arabia $4,778

Emirates National Bank of Dubai (NBD)

53 UAE $4,734

Consolidated Contractors International Co.


Abu Dhabi National Energy Company (TAQA)

55 UAE $4,589

Turkish Airlines 56 Turkey $4,508

Bank Melli Iran 2 57 Iran $4,473

Group ONA 58 Morocco $4,445

Saad Group of Companies 2 59 Saudi Arabia $4,352

M.A. Kharafi & Sons 2 60 Kuwait $4,300

Bank Rakyat Indonesia 61 Indonesia $4,299

Suez Canal Authority 62 Egypt $4,280

Axiata Group Berhad 63 Malaysia $4,278

Electricity Generation Company Inc. (EUAS)

64 Turkey $4,199

Bank Mandiri 65 Indonesia $4,141

Indofood 66 Indonesia $4,122

Syrian Petroleum Company 1 67 Syria $4,101

Sapco 2 68 Iran $4,071

IOI Group 69 Malaysia $4,054

Felda Holdings Bhd 70 Malaysia $3,865

Orascom Construction Industries

71 Egypt $3,830

CIMB Group 72 Malaysia $3,720

National Commercial Bank 73 Saudi Arabia $3,681

Malaysian Airline System Bhd 74 Malaysia $3,655

Saud Bahwan Group 2 75 Oman $3,500

UMW Holdings Bhd 76 Malaysia $3,464

BIM Birlesik Magazalar A.S. 77 Turkey $3,442

Brunei Petroleum 1 78 Brunei $3,441

Eregli Iron And Steel Works Co. (Erdemir)

79 Turkey $3,355

Samir Sa 80 Morocco $3,323

Independent Petroleum Group 81 Kuwait $3,291

Mobile Communications Company of Iran

82 Iran $3,272

Selçuk Ecza Deposu 83 Turkey $3,250

PT Bumi Resources Tbk 84 Indonesia $3,219

Al Rajhi Banking and Investment Corp.


Public Bank Bhd. 86 Malaysia $3,090

Bank Central Asia Tbk 87 Indonesia $3,085

Eczacibasi Holdings 3 88 Turkey $3,015

PT Adaro Energy Tbk 89 Indonesia $2,980

Vestel 4 90 Turkey $2,977

Gudang Garam Tbk PT 91 Indonesia $2,964

Etihad Airways 92 UAE $2,951

DP World 93 UAE $2,929

Tasnee (National Industrialization Company)


Genting Berhad 95 Malaysia $2,873

Telekom Malaysia Bhd 96 Malaysia $2,780

Arab Bank PLC 97 Jordan $2,727

Ciner Group 2 98 Turkey $2,680

Perusahaan Otomobil Nasional Bhd (Proton)

99 Malaysia $2,676

Kuwait Finance House 100 Kuwait $2,672

References

• http://www.state.gov• http://www.unilever.co.id• http://policy-practice.oxfam.org.uk• http://www.thejakartapost.com

THANK YOU


Economy & Finance

Final ib pptx