null The IFSB Issues Exposure Draft of the Core Principles for Islamic Finance Regulation (Financial Market Infrastructures) (ED- 26) for Public Consultation
The IFSB Issues Exposure Draft of the Core Principles for Islamic Finance Regulation (Financial Market Infrastructures) (ED- 26) for Public Consultation
22 Oct 2021 | Friday source : IFSB
The Islamic Financial Services Board (IFSB) has today issued the Exposure Draft of Core Principles for Islamic Finance Regulation (Financial Market Infrastructures) (ED-26) for Public Consultation for a period of fourty five days, starting from 10 September 2021 until 25 October 2021. The IFSB invites comments from regulatory and supervisory authorities, international organisations, institutions offering Islamic financial services (IIFS), academics and other interested parties.
The Standard intends to provide a set of core principles for FMIs and their regulation and supervision taking into consideration the specificities relating to Islamic finance, while complementing the existing international standards, principally the CPSS-IOSCO documents. Ultimately, the Standard intends to achieve the following objectives:
- to develop a comprehensive standard for effective regulation, supervision, and oversight of FMIs addressing the specificities of Islamic finance;
- to equip RSAs with minimum international benchmarks to ensure safe, transparent, and robust FMIs for the purpose of preserving financial stability and operational efficiency in Islamic finance jurisdictions; and
- to assist the RSAs in assessing the quality of their regulatory framework for their respective FMIs and identifying areas for improvement as an input to their reform agenda.
Core Principles for regulation of the financial sector have become standard tools to guide Regulatory and Supervisory Authorities (RSAs) in developing their regulatory regimes and practices. They also serve as the basis for regulatory authorities or external parties such as multilateral agencies to assess the strength and effectiveness of regulation and supervision in a jurisdiction. This Standard intends to complement the CPSS -IOSCO Principles for Financial Market Infrastructures (PFMI) (April 2012) and its associated Disclosure Framework and Assessment Methodology (December 2012), to address areas that either do not deal, or deal inadequately, with the specificities of Islamic finance.
The IFSB envisages that the Core Principles for Islamic Finance Regulation (Financial Market Infrastructures) (CPIFRFMI) will be used by jurisdictions as a benchmark for assessing the quality of their regulatory and supervisory systems, and for identifying future work to achieve a baseline level of sound regulations and practices for Islamic FMIs. The development of the CPIFRFMI is intended to promote further integration of Islamic finance with the international architecture for financial stability and operational efficiency, especially in the area of securities clearing and settling, payment, and data recording in the FMIs. Furthermore, the CPIFRFMI may also assist IFSB member jurisdictions in: (a) self-assessment; (b) the International Monetary Fund (IMF) and the World Bank financial sector assessment programme (FSAP); (c) reviews conducted by private third parties; and (d) peer reviews conducted, for instance, within regional groupings of capital market RSAs.
The IFSB will be conducting an online webinar as part of the public consultation process. Participation in the webinar is free and open to all. The usual public hearing for this standard will not be held in view of the ongoing global pandemic, but will be replaced by the online webinar.
The soft copy of ED-26 is available on the IFSB website, www.ifsb.org and the Secretariat invites all interested parties, especially members of the IFSB, to send their comments on ED-26 to the project team through email at firstname.lastname@example.org by 20 October 2021 at the latest.
Date posted: 10 September 2021
Date posted: 10 September 2021