HONG KONG: Hong Kong moving towards Islamic Funds

Thursday May 22 2008

Hong Kong’s Securities & Futures Commission (SFC) in its latest newsletter has today announced the signing of an MOU with the Dubai Financial Services Authority (DFSA). This is in line with Hong Kong’s continuous effort in strengthening its position as an international financial centre.

Under the MOU, both parties will examine the possibility of establishing a framework for the mutual recognition of their regulatory regimes on Islamic funds to facilitate cross-border marketing and distribution of Islamic funds, hence promoting closer ties between the SFC and DFSA.

Islamic funds seek to achieve compliance with the investment principles under the Islamic Religious laws of Shariah which generally preclude funds from investing in businesses such as conventional financial services, alcohol, pork-related products, gambling, leisure and entertainment. Islamic funds are also restricted from venturing in interest bearing investments.

The Funds-Axis Ltd team has exposure to Islamic finance including in Kuwait and Malaysia and is currently engaged in extensive review of Shariah compliant fund structuring opportunities. For further information contact sibtain.sajan@funds-axis.com