The Rise of Islamic Financial Mediation in Asia as a Consequence of the Worsening Economic Crisis

• Main Author: WHITE, Andrew
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2009
• Subjects: Islam; Islamic finance; ADR; mediation; disputes; Asian Studies; Commercial Law; Religion Law
• Online Access: https://ink.library.smu.edu.sg/sol_research/514
• Institution: Singapore Management University

As the economic crisis has encouraged many to look to Islamic finance as an important alternative to conventional structures and ways of doing finance, Islamic financial dispute resolution also will become increasingly important. This presentation proposes a dispute resolution approach that can accommodate Islamic legal values and traditions in resolving the inevitable disputes that arise in the context of Islamic banking, finance, and takaful in this Region. The presentation suggests a simple solution similar to that applied successfully in many other substantive areas of law and dispute resolution: Shari‘ah-based alternative dispute resolution, utilizing a hybrid of traditional Islamic concepts of binding arbitration (tahkim), non-binding settlement (sulh), reconciliation (musalaha), and non-binding mediation (wasaatah). It is suggested that Shari‘ah-based ADR, grounded in Islamic law and historical traditions that extend back to the earliest revelation of Islam, be applied in the commercial context of Islamic finance.