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Islamic banking transactions are based on Islamic principles that prohibit the charging of interest (riba) on loans and require that any return on funds employed by the lender be earned by way of profit derived from a commercial risk taken by the lender. Thus, an Islamic financial institution will lend funds to borrowers on the basis that it shall share in the risks
and the rewards taken by the same. As such, the financial institution’s return depends on the financial success of the client instead of receipt of an income stream calculated by market rates.
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In addition, under Islamic law, finance may only be made available for investments or projects that do not contradict Islamic principles. Hence, Islamic financing would not be available for investments or projects dealing with alcohol, gambling or pork products.
Al Wagayan, Al Awadhi & Al Saif has been involved in a multitude of various Islamic finance transactions as well as providing counsel to clients on Islamic banking in general. In addition, as Islamic financial transactions and dealings grow more complex in various areas including Sukuk (Islamic bond) issues or Takaful (Islamic insurance), our attorneys have kept pace and are actually in the forefront of this development. Clients look to our law firm because of both are in-depth knowledge of Islamic Shari’a law as well as our practical abilities to resolve issues and actually close deals. |
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Al Wagayan, Al Awadhi & Al Saif
Suad Commercial Complex, 9th Floor
P.O. Box 22833 – Safat 13089 Kuwait
TEL:+965 2472317 – FAX:+965 2472318
EMAIL: info@awaslegal.com
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