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Effective September 1, 2018: AAOIFI Standards Required in UAE

Effective September 1, 2018: AAOIFI Standards Required in UAE

Manama, Bahrain, July 17, 2018

(Note: Ethica’s CIFE is the only globally recognized third-party certification that is 100% AAOIFI-Compliant to our knowledge)

The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI), a Bahrain-based standard-setting body for the Islamic financial industry, has welcomed the Central Bank of the UAE (CBUAE) adopting its standards. This follows a recommendation from the Higher Sharia Authority of CBUAE.

According to a recent pronouncement, all full-fledged Islamic banks, Islamic windows of conventional banks, and finance companies offering Sharia-compliant products and services in the UAE are required to comply with the AAOIFI standards with effect from September 1.

This will also require the revision of existing products and services of these institutions to be in compliance with AAOIFI standards.

AAOIFI’s board of trustees chairman Shaikh Ebrahim bin Khalifa Al Khalifa said, “Adoption of AAOIFI standards by the Central Bank of the UAE is a big encouragement.

“The UAE holds approximately 20 per cent share in the global Islamic banking market and this decision by the UAE regulator will play a significant role in the harmonisation of Islamic financial industry practices across the globe.

“This is also a testimony of the robustness of AAOIFI standards, which complement the modern finance and banking practices with the economic principles of Islam. AAOIFI welcomes and thanks the Central Bank of the UAE for recognising this. I am sure this will lead other jurisdictions around the globe to follow suit,” he added.

Presently, AAOIFI standards have been fully or partially adopted or being adopted in more than 19 countries and jurisdictions, and additionally as recommended guidelines or referenced by regulatory bodies of more than seven countries and jurisdictions.

AAOIFI Sharia standards are available in Arabic (official), English, French, Russian and Urdu languages, while the translation in Chinese (Mandarin) and Turkish languages is being finalised.

 

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