Finality of arbitral awards under Islamic or sharia law Dissertation

Finality of arbitral awards under Islamic or sharia law - Dissertation Example Islamic countries ‘too often have impermissibly interfered with international arbitration cases.’4 Many different cultural, political, and geographical factors have constituted the foundation of the Islamic legal system, and pure knowledge of the law does not suffice to understand the Islamic jurisdictional system.5 While international arbitration as a contemporary legal system is relatively new to Arab nations, arbitration per se in the Islamic world dates back to 622 A.D. ... Jarrar8 called the finality of arbitration as arbitrary, and the principle that the results of arbitration are binding and final is a myth. This is not to say, however, that the teachings of Sharia are directly contradictory to the recognition and enforcement of arbitral awards. It is actually to the greater interest of Islamic countries which issue Sukuk bonds to streamline arbitration proceedings to reduce the perceived risks investors assume when investing in these Sharia-based financial instruments. Arbitration is invaluable for the average investor to pursue claims in any dispute, including Islamic finance, because arbitration is usually less costly and therefore favourable to individual investors. Added to these is the absence of uniformity among remedies and the complexities of navigating conflicts of law issues makes litigation an unfavourable means of obtaining relief. Therefore, it is to the advantage of Islamic financial institutions, in particular, and Islamic business in general to enhance systematic procedures that affirm and enforce arbitral awards, both domestic and international. 1.2 Conventions influencing the enforcement of arbitral awards in Islamic member states As of January 1, 2009, 143 out of a total of 192 member States have adopted the New York Convention of 1958, among whom are all the major players in the Sukuk bonds market, namely Malaysia (1985), Bahrain (1988), Qatar (2003) and the UAE (2006). This is because Sukuk issuances have come to be accepted globally, and its compliance with arbitration is most useful in the resolution of international disputes arising out of the terms of the Sukuk contracts. Increasingly, the Gulf States have over the years acceded to the Convention, including Kuwait