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  • AU-1.4 AU-1.4 Shari'a Compliant Transactions

    • General Requirements for all Conventional Financing Companies

      • AU-1.4.1

        Conventional financing company licensees may not hold themselves out as an Islamic financing company. Conventional financing company licensees are allowed to enter into activities (a) to (c) listed in Rule AU-1.3.1 under the conditions outlined in the remainder of this Section, subject to conditions outlined in Section AU-1.2 (concerning facilities offered to Bahrain residents and facilities in Bahrain Dinar in particular).

        January 2013

      • AU-1.4.2

        When offering any of the Shari'a compliant activities listed in Rule AU-1.3.1, conventional licensees must have staff trained in Shari'a compliant financing business. The licensee must also disclose in the notes to its Annual Report/Financial Statement all quantitative and qualitative disclosures on its Shari'a compliant business as required by AAOIFI accounting and auditing standards.

        January 2013

    • Additional Requirements for Conventional Financing Companies

      • AU-1.4.3

        Conventional licensees may provide Shari'a compliant activities (b) and (c) listed in Rule AU-1.3.1 in any amount and in any currency to Bahrain-resident individuals subject to the following conditions:

        (a) Shari'a compliant financing transactions to be undertaken through a special counter or branch as deemed necessary by the licensee;
        (b) The licensee must maintain separate books for Shari'a compliant financing activities to ensure no co-mingling of conventional and Islamic funds;
        (c) The licensee must have a Shari'a Compliant Reviewer; and
        (d) The licensee must establish a Shari'a Supervisory Committee with a minimum of three board members. The board may have global authority for all Shari'a compliant business or may have authority purely for Islamic business booked in Bahrain.
        January 2013