The Sharia is a mechanism which governs every aspect of a Muslim's life. A practising Muslim is required to lead a just and pure life to achieve piety. In this endeavour, his/her income and expenditure must remain free of impurities (such as the receipt or payment of interest). To do otherwise would be to commit a sin. The need for Islamic finance can therefore be seen as a spiritual necessity rather than an economic convenience.
As it is apparent from the above, many cross-border Islamic finance transactions, contracts are often governed by English law with the English courts expressly having the jurisdiction to decide on the necessary disputes. The stagnating fact that an Islamic finance contract, although governed by English law, must still comply with the regulations and reformations of the principles of the Sharia in order to be rightfully enforced in order to provide for the just equilibrium of balance and correlation existing between the two systems alike. Sharia Law must develop a distinctive corporate culture, the main purpose of which is to create a collective morality and spirituality which, when combined with the production of goods and services sustains the growth and advancement of the Islamic way of life as quoted in The Pak Banker.
Endnotes
1. Arbitration Between Petroleum Dev. (Trucial Coast) Ltd. v. Sheikh of Abu Dhabi, 1 INT’L & COM P. L. Q. 247, 250–51 (Sept.1951). 2. 1 WLR 1784 (CA 2004) (UK) 3. European convention 80/934/ECC on the law Applicable to Contractual Obligations (Rome Convention) [1980] 4. Jonathan G. Ercanbrack- The Law Of Islamic Finance In the United Kingdom (supra)
Minal Kaul
Margarida Narciso
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