The structural development of Istisna' sukuk structure from Shari'ah perspective

Istiṣna’ sukuk structures have been widely accepted for manufacturing and construction financing purposes. This paper looks at the structural development of Istiṣna’ Sukuk and evaluates both its basic and combination structures. Concerning the former, the paper argues that when Istiṣna’ is used for...

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Main Authors:	Adam Sa'ad, Auwal, Mohammad Deen, Mohd Napiah, Ibrahim, Uzaimah
Format:	Article
Language:	English
Published:	International Institute of Advanced Islamic Studies (IAIS) 2016
Subjects:	HG3368 Islamic Banking and Finance
Online Access:	http://irep.iium.edu.my/71195/ http://irep.iium.edu.my/71195/ http://irep.iium.edu.my/71195/1/Structural%20Development%20of%20Istisna%27%20Sukuk%20from%20Shari%27ah%20perspective.pdf

id	iium-71195
recordtype	eprints
spelling	iium-711952019-11-26T04:53:00Z http://irep.iium.edu.my/71195/ The structural development of Istisna' sukuk structure from Shari'ah perspective Adam Sa'ad, Auwal Mohammad Deen, Mohd Napiah Ibrahim, Uzaimah HG3368 Islamic Banking and Finance Istiṣna’ sukuk structures have been widely accepted for manufacturing and construction financing purposes. This paper looks at the structural development of Istiṣna’ Sukuk and evaluates both its basic and combination structures. Concerning the former, the paper argues that when Istiṣna’ is used for asset purchasing exercises, it should strictly comply with the general Shari’ah rules regarding Istiṣna’ contracts. Prices must therefore be stipulated at the beginning, as must quality and expected delivery times. The paper then highlights some conflicting features arising from the combination of Istiṣna’ and Ijarah transactions. These raise Shari’ah issues when the issuer seeks to lease an asset to the end user at maturity, even though the asset has been transferred to that end user by way of the Istiṣna’ contract. It is therefore recommended that the market innovates in order to develop additional structures free from this type of impediment. The study proposes a multiple contract’ structure be used whenever Istiṣna’ sukuk is issued in combination with other debt and equity instruments. This will help overcome Shari’ah issues related to secondary markets in Istisna' sukuk issuances. International Institute of Advanced Islamic Studies (IAIS) 2016 Article PeerReviewed application/pdf en http://irep.iium.edu.my/71195/1/Structural%20Development%20of%20Istisna%27%20Sukuk%20from%20Shari%27ah%20perspective.pdf Adam Sa'ad, Auwal and Mohammad Deen, Mohd Napiah and Ibrahim, Uzaimah (2016) The structural development of Istisna' sukuk structure from Shari'ah perspective. Journal of Islam and Civilizational Renewal, 7 (2). pp. 231-243. ISSN 2041-871X E-ISSN 2041-8728 https://www.icrjournal.org/icr/index.php/icr/article/view/549/510
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HG3368 Islamic Banking and Finance
spellingShingle	HG3368 Islamic Banking and Finance Adam Sa'ad, Auwal Mohammad Deen, Mohd Napiah Ibrahim, Uzaimah The structural development of Istisna' sukuk structure from Shari'ah perspective
description	Istiṣna’ sukuk structures have been widely accepted for manufacturing and construction financing purposes. This paper looks at the structural development of Istiṣna’ Sukuk and evaluates both its basic and combination structures. Concerning the former, the paper argues that when Istiṣna’ is used for asset purchasing exercises, it should strictly comply with the general Shari’ah rules regarding Istiṣna’ contracts. Prices must therefore be stipulated at the beginning, as must quality and expected delivery times. The paper then highlights some conflicting features arising from the combination of Istiṣna’ and Ijarah transactions. These raise Shari’ah issues when the issuer seeks to lease an asset to the end user at maturity, even though the asset has been transferred to that end user by way of the Istiṣna’ contract. It is therefore recommended that the market innovates in order to develop additional structures free from this type of impediment. The study proposes a multiple contract’ structure be used whenever Istiṣna’ sukuk is issued in combination with other debt and equity instruments. This will help overcome Shari’ah issues related to secondary markets in Istisna' sukuk issuances.
format	Article
author	Adam Sa'ad, Auwal Mohammad Deen, Mohd Napiah Ibrahim, Uzaimah
author_facet	Adam Sa'ad, Auwal Mohammad Deen, Mohd Napiah Ibrahim, Uzaimah
author_sort	Adam Sa'ad, Auwal
title	The structural development of Istisna' sukuk structure from Shari'ah perspective
title_short	The structural development of Istisna' sukuk structure from Shari'ah perspective
title_full	The structural development of Istisna' sukuk structure from Shari'ah perspective
title_fullStr	The structural development of Istisna' sukuk structure from Shari'ah perspective
title_full_unstemmed	The structural development of Istisna' sukuk structure from Shari'ah perspective
title_sort	structural development of istisna' sukuk structure from shari'ah perspective
publisher	International Institute of Advanced Islamic Studies (IAIS)
publishDate	2016
url	http://irep.iium.edu.my/71195/ http://irep.iium.edu.my/71195/ http://irep.iium.edu.my/71195/1/Structural%20Development%20of%20Istisna%27%20Sukuk%20from%20Shari%27ah%20perspective.pdf
first_indexed	2023-09-18T21:41:04Z
last_indexed	2023-09-18T21:41:04Z
_version_	1777413142958047232

The structural development of Istisna' sukuk structure from Shari'ah perspective

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