Islamic Finance: Structuring Sukuk in the Netherlands

The Islamic banking & finance market is growing fast. With an annual growth of 15%, this sector seems much promising. Within the Islamic finance market, sukuk are arguably the most important Islamic financial products. Sukuk are referred to as the Shari`ah-compliant equivalent of bonds. These securities are an excellent instrument to attract investments from the Middle East and Southeast Asia to the Western world. In addition, with a significant Muslim population in Europe, the demand for Islamic financial products seems to be present in Europe as well. Thus, European countries such as the United Kingdom, Germany, France, and Luxembourg, are aiming to become Islamic finance centres. However, Islamic financial products are rather unknown in the Netherlands. This raises the question to the possibilities for Islamic finance, and more in particular for sukuk, in the Netherlands. Most of the sukuk issuances have been realised in Dubai and Malaysia, whereby English law concepts are used to structure these transactions. Adapting these instruments to the Dutch legal context requires a thorough understanding of sukuk and of its religious, legal, and transactional requirements. Through an interdisciplinary approach and a comparative study, this research will lead to more insight into Islamic financial principles and Islamic financial contracts, enabling the reader to understand sukuk structures and transactions. The main focus of the study is to analyse the legal aspects of sukuk structure under Dutch civil law. O. Salah is currently working as Ph.D. Researcher and Lecturer at Tilburg Law School. His doctoral research is on Islamic finance and more in particular on sukuk structures under Dutch civil law. Salah is also affiliated to De Brauw Blackstone Westbroek. Series Harry Honée Fund Master Thesis Award - Volume 1