Dispute management in Islamic financial institutions: a case study of near sukuk defaults

Oseni, Umar Aimhanosi (2014) Dispute management in Islamic financial institutions: a case study of near sukuk defaults. Journal of International Trade Law and Policy, 13 (3). pp. 198-214. ISSN 1477-0024

	PDF (Published Article) - Published Version Restricted to Repository staff only Download (256kB) | Request a copy
Preview	PDF (scopus) Download (219kB) | Preview
Preview	PDF (SCOPUS) Download (148kB) | Preview

Abstract

Purpose – The purpose of this paper is to examine the vital importance of dispute management in cases of both near and outright sukuk defaults. With the case studies, this study examines the vital importance of dispute management in cases of both near and outright sukuk defaults. With a number of case studies, the study shows how debt restructuring can play a significant role as a dispute management procedure recognized in Islamic law. Design/methodology/approach – The study uses the case study methodology to determine the impact of debt restructuring in instances of near and outright sukuk default and the process taken to reach a win-win settlement among the parties. Due to some sensitive financial information, the study has fully anonymized the sukuk companies examined. Findings – The paper finds that for a more sustainable and stable and resilient Islamic finance industry, the role of law through dispute management cannot be ruled out, as appropriate dispute management mechanism facilitates the underlying contracts. Research limitations/implications – This study limits its focus to near and outright sukuk defaults and the need to come up with Shari’ah-based mechanisms for dispute management when things seem to have fallen apart. Practical implications – The study proposes an integrated regulatory-cum-remedial framework which may serve as sustainable mechanism for handling circumstances involving near and outright sukuk defaults with a view to protecting the rights of all the stakeholders. Originality/value – Though few studies have been conducted on sukuk defaults in cross-border transactions, there has not been much focus on dispute management of cases involving such defaults. This study seeks to fill such an important gap, which has the potential of streamlining dispute management practices in the sukuk industry.

Item Type:	Article (Journal)
Additional Information:	6807/38861
Uncontrolled Keywords:	Islamic financial institutions, Dispute resolution, Debt restructuring, Islamic investment certificates, Sukuk defaults
Subjects:	H Social Sciences > HG Finance H Social Sciences > HG Finance > HG178 Liquidity H Social Sciences > HG Finance > HG4001 Financial management. Business finance. Corporation finance. K Law > K Law (General) K Law > KBP Islamic Law
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Ahmad Ibrahim Kulliyyah of Laws > Department of Civil Law
Depositing User:	Dr. Umar Aimhanosi Oseni
Date Deposited:	23 Oct 2014 11:20
Last Modified:	19 Sep 2017 12:10
URI:	http://irep.iium.edu.my/id/eprint/38861

Actions (login required)

View Item