Selected Shariah Issues In Sukuk Structures: A Comparative Approach

Résumé: The purpose of this paper is to explore the extent of Shariah compliance in the contracts underlying sukuk structures and their conformity to the objectives behind such contracts. It does this by exposing the prevalent opinions to a maqasid matrix to judge their validity. The Shariah issues underlying sukuk structures are divided into four primary issues that pertain to a certain category of sukuk or most sukuk regardless of the category and focus on the most important and prevalent issues as identified by Islamic economists, jurists and other researchers. The most important findings are that the issues as they relate to important principles and elements of muamalat or Islamic contracts law exist and are real including, but not limited to: possession and legal or beneficial ownership of assets, the debt nature of sale-based sukuk, lack of PLS considerations, and the loss of contact with the real economy. The literalists approach does not incorporate Shariah objectives as ideal standards for sukuk structuring, and similarly, the alternative approach features reductionist tendencies to certain principles. This research provides a theoretical basis on which to judge, from an objective perspective, sukuk issuances and so does not provide practical steps to implementation. This paper takes a much-needed comprehensive look at sukuk structuring in light of the means and objectives of the structuring practice and is expected to provide an original dynamic alternative for scrutinizing structuring practice.

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