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8 Derivatives and Islamic Finance

David M. Eisenberg

From: Islamic Finance: Law and Practice

Edited By: Craig R.Nethercott, David M. Eisenberg

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved.date: 19 April 2024

Electronic money — Pledge — Futures — Options — Swaps — Debt — Exchange control — International Swaps and Derivatives Association (ISDA) — Set-off
8.01 Bridging the gap between traditional Islamic transaction structures and conventional derivatives is among the most urgent challenges facing the global Islamic finance industry, not least to provide Islamic financial institutions with a crucial tool for risk management. In this chapter we examine bay‘ salam and bay‘ ‘urbun as sale contracts under the Shari‘a, examples of conventional derivatives based on these and other traditional Islamic transaction structures, and the adaptation of the ISDA Master Agreement to Shari‘a principles.1A Examination of the...
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