Abstract:
Since the introduction of Islamic finance in Malaysia three and half decades ago, the Malaysian judiciary has been confronted with various legal issues involving Islamic finance. While it is not the purpose of the article to provide an exhaustive list of decided cases in chronological order, the aim is to highlight the main issues impacting the practical aspects in the Islamic finance industry, namely, the issues of ibra’ (waiver), late payment charges, reference to the Shariah Advisory Council, enforceability of non-Shariah-compliant contracts and sukuk default. This is done through an analysis of reported court cases by the Superior Courts. It is found that the courts have adopted a pragmatic approach in dealing with Islamic finance matters of practical importance, hence providing clarity and certainty to the industry players.