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Islamic Law (Shariah)

Shariah Islamic Law applies in muslim countiresShariah mainly is based on the versus of the Holy Quran and the teachings and practices of the Prophet Mohammed (the Sunna).  The consensus of opinions and interpretations of religious scholars is considered a secondary source of Shariah

In the Area where the majority of the population is Muslim, there is a notable trend for the applications of Shariah. While most of the laws are based on Shariah, specific areas of laws are now increasing adopting  important aspects of Shariah which will be indicated below where Sabah Mahmoud has advised and assisted clients. 

1. Islamic Banking

Except for Saudi Arabia, the banking laws and practices of countries of the Area are generally based on western banking systems. A notable trend for the application of banking based on Shariah (called Islamic Banking) started in the Area in recent years. Islamic Banking could, in theory, be fairly straight forward. In accordance with Shariah Muslims can trade and invest in anything that is accepted (called halal) and not prohibited (haram). Prohibited matters broadly include things that are illegal or immoral such as gambling, prostitution, pornography, alcohol, drugs and similar other matters. The main difficulty arises in the classification of interest charged on funds in Shariah. While some Islamic jurists and scholars consider all types of interest as usury which is prohibited in Shariah, others consider simple interest acceptable and only compounded interest to be prohibited. Although the argument on interest continues, Islamic banking is expanding in the Area where banks and investment funds based on Shariah banking are being established.

For more information see Extracts from the book "UAE Company Law"

2. Inheritance

Shariah provides specific rules of inheritance that are applied to Muslims. Generally these rules are based on the principle of providing specific allocation/shares of the estate of the deceased to certain types of his relatives such spouse or parents and the distribution of the remainder to other heirs such as offsprings, brothers/sisters and uncles/aunts. Shariah rules of inheritance  are applied in the countries in the Area. They might also apply to the assets of a deceased Moslem person in a western jurisdiction or a Moslem resident in such a country. 

3. Wills

Wills might form part of the probate of the estate of a deceased Moslem. Shariah inheritance rules regulate wills by providing that a will can only be applied and valid to a certain portion of the total estate and to specific persons.




Companies in Islamic (Sharia) Law


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