SECP introduces Shariah advisers rules

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) on Tuesday introduced draft Shariah Advisers Regulations 2017, a statement said.

The Shariah Advisers Regulation 2017, framed under the Companies Act 2017, are expected to professionalise Shariah advisory services, it said. Companies would only be able to engage the Shariah advisers who would be on the SECP's panel. To join this panel, Shariah advisers would need to meet fit and proper criteria and abide by a code of conduct that emphasises independence and objectivity, it added.

The SECP regulates important elements of Islamic financial services industry. These elements include Islamic mutual and pension funds, modarabas and non-banking financial institutions (NBFIs), takaful operators, Shariah-compliant companies, Shariah-compliant securities, Shariah-compliant real estate investment trusts, and Shariah-compliant indices.

Some of these elements have shown impressive growth. For instance, the share of Shariah-compliant assets of non-banking financial institutions sector has grown to 34.6 percent as of June 2017 as compared to 12.3 percent in June 2010.

The regulations have been drafted after an extensive consultation process with the representatives of Shariah advisers, Islamic Financial Services Board Malaysia, State Bank of Pakistan, Pakistan Stock Exchange, Institute of Chartered Accountants of Pakistan, takaful operators, Modaraba and NBFI Association, Mutual Funds Association of Pakistan and Shariah Board of SECP.

The draft Shariah Advisers Regulations 2017, available on the website of SECP, are now open to public for consultation and stakeholders have two weeks to share their views. The Securities and Exchange Commission of Pakistan would notify the final regulations after taking into consideration the comments, suggestions and inputs received during the public consultation.