Dubai: The Higher Shariah Authority (HSA) for financial and banking activities recently met and reviewed COVID-19 pandemic’s effects on the economy and approved a set of Shariah paremeters to mitigate it’s impact on affected individuals and companies.
The Has urged Islamic financial institutions to join their efforts in supporting sectors and individuals affected by this pandemic.
The meeting was chaired by Sheikh Dr. Ahmed Bin Abdulaziz Al Haddad, the Chairman of the HSA, and attended by the members of the HSA: Sheikh Prof. Dr. Jassim Ali Al Shamsi, Sheikh Issam Muhamad Ishaq, Sheikh Dr. Aznan Hasan, and Sheikh Dr. Usaid Muhammad Adeeb Al Kilani.
At the meeting, the HSA adopted its report for the year 2019, which maps the most significant achievements, initiatives and resolutions conducted during the year.
Shariah perameters for relief
The HSA also issued Shariah parameters related to the postponement of installments for Islamic financial institutions’ customers and how to deal with such postponment from a Shariah perspective based on the type of the transactions and their Shari’ah contracts.
The HSA reviewed its agenda and adopted some Shari’ah standards and parameters for calculating of the collections costs incurred by Islamic financial institutions from late payment transactions. The HSA also discussed issues related to the imposition of fees on loan based transactions, where HAS instructed to conduct consultation with Islamic Banking Committee of the UAE Banks Federation, to identify best practices in this regard.
The HSA also reviewed requests for new financial products submitted by some Islamic financial institutions, and approved the applications that comply with the applicable Sharia standards. The HSA stressed the need to strike a balance between development and innovation in Islamic financial products and the regulatory and Shariah requirements.
The Authority considered requests submitted by Islamic financial institutions regarding the approval of annual Shari’ah reports, the appointment of members of the Internal Shariah Supervision Committees, and the heads of the Internal Shariah Control and Shariah Audit Departments, and issued resolutions in this regard.
To further improve the role of Internal Shariah Supervision Committees in Islamic financial institutions, the HSA was instructed to prepare a Charter template for the Internal Shariah Supervision Committees based on best practices and to initiate a consultation about it with Islamic financial institutions.