AAOIFI’s Sharia board holds first meeting

Manama, Mar. 22 (BNA): The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI)'s newly-formed Sharia board (ASB) held its first meeting (and the 43rd meeting since the Organisation's formation) for its new term of office, on March 10-12 in the Kingdom of Bahrain. ASB meeting was commenced by electing a chairman and vice chairman through secret ballot. The process led to election of Shaikh Mohammed Taqi Usmai (a prominent, leading Sharia scholar and jurist, and Chairman of the Sharia Board, Central Bank of Pakistan; Vice President, Darul-Oloom; member of international fiqeh academies) as Chairman and Shaikh Dr. Abdul Sattar Abu Ghuddah (a prominent Sharia jurist who is also chairman and member in a number of Sharia Supervisory Boards in the global Islamic finance industry) as Vice Chairman. Then, the board reviewed a detailed report prepared by AAOIFI’s Secretariat General on its technical efforts extended in the area of Sharia standards development and the meetings of ASB and its subcommittees. In this regard, Dr. Hamid Merah, Secretary General of AAOIFI, revealed that 40 board and subcommittee meetings have been held over the period of 18 months (from September 2014 to February 2016); an average of 2.2 meetings per month and that some of these meeting extended over three days. The landmark outcomes included discussion, approval and official issuance of 6 exposure drafts for new Sharia standards; issuance of revised and reviewed versions of 13 standards; and discussion of 11 new research studies. He added that 19 standards are currently under development – at different stages of finalization- and some of them are expected to be finalized and issued in 2016. The board also decided to re-form its Dubai, Jeddah, Kuwait, and Karachi subcommittees and to form three new subcommittees (Amman, Riyadh, and Kuala Lumpur), where each subcommittee will have a number of ASB members amongst its members, and no less than 50% of members will be selected from amongst country-based experts and scholars who are not ASB members. The ASB defined the roles of these committees, among others, as review and discussion of preliminary studies and research papers submitted to the board for Sharia standards development, presentation of recommendations and remarks about these studies and research papers, and submission of the same to the ASB for consideration, in addition to revision and discussion of Sharia standards’ exposure drafts and presentation of recommendations it deems appropriate about exposure drafts, both in form and substance, and then submission of the same to the ASB. The ASB also regrouped its other specific-purpose subcommittees such as drafting subcommittee, translation sub-committee, and standardization of Sharia standards terminology subcommittee. Furthermore, ASB had thoroughly studied all remarks and recommendations collected from public gatherings in Morocco, Jordan, and Saudi Arabia with regard to exposure draft of the Sharia Standard on "Competitions and Prizes", in addition to those submitted by a number of experts from different parts of the world. In view of this, the ASB made major amendments to the exposure draft and referred it to the drafting subcommittee before official issuance very soon. ASB also made a number of imperative resolutions including the commissioning of a Sharia scholar and a legal expert to jointly prepare a detailed study on "Construction Contracts and FIDIC Contracts" to initiate the development process for a separate Sharia Standard on these contracts. The board also commissioned a consultant to prepare a detailed study on "Fees and Commissions". ASB decided to hold its next meeting from 1 to 3 May 2016 in Al-Madina Al-Munawwara.