Establishing a Legal Framework for Sovereign Sukuk Issuance : A Public Debt Management Perspective
A strong legal framework that forms the basis for the activities of debt managers is crucial for enabling an effective public debt management function. This paper aims to complement discussions on the legal foundations of debt management by detecti...
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2017
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| Online Access: | http://documents.worldbank.org/curated/en/907001497472893193/Establishing-a-legal-framework-for-sovereign-sukuk-issuance-a-public-debt-management-perspective http://hdl.handle.net/10986/27536 |
| Summary: | A strong legal framework that forms the
basis for the activities of debt managers is crucial for
enabling an effective public debt management function. This
paper aims to complement discussions on the legal
foundations of debt management by detecting and discussing
essential elements that allow the government to issue sukuk,
the equivalent of bonds, in Islamic finance. Drawing on the
cases of recent sovereign issuers, these discussions begin
with outlining the clear provision of a mandate to issue and
to employ certain public assets in the execution of
underlying transactions, as well to establish, engage with,
and administer Special Purpose Vehicles used in structuring
these issuances. Additional aspects that need to be
addressed are the treatment of proceeds and the assurance of
investors with regards to debt service. The enabling
environment should be complemented by changes in the
taxation regime and financial market regulations that
facilitate the issuances. |
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