Malaysia legislation
Section 33D
Section 33D
(2)
For the purposes of subsection (1), a compliance with any advice or ruling of the Shariah Advisory Council in respect of any particular business, affair or activity shall be deemed to be a compliance with Shariah in respect of that business, affair or activity.
(3)
Where a prescribed institution becomes aware that it is carrying on any of its business, affair or activity in a manner which is not in compliance with Shariah or the advice of its Shariah committee or the advice or ruling of the Shariah Advisory Council, the prescribed institution shall—
(a)
immediately notify the Bank and its Shariah committee of the fact;
(b)
immediately cease from carrying on such business, affair or activity and from taking on any other similar business, affair or activity; and
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(c)
within thirty days of becoming aware of such non-compliance or such further period as may be specified by the Bank, submit to the Bank a plan on the rectification of the non-compliance.
(4)
The Bank may carry out an assessment as it thinks necessary to determine whether the prescribed institution has rectified the non-compliance referred to in subsection (3).
(5)
Any prescribed institution that contravenes subsection (1)
or (3) commits an offence and shall on conviction be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
Power of the Bank to specify standards on Shariah matters
*33E. (1) The Bank may, in accordance with the advice or ruling of the Shariah Advisory Council, specify standards—
(a)
on Shariah matters in respect of the carrying on of business, affair or activity by a prescribed institution which requires the ascertainment of Islamic law by the Shariah Advisory
Council; and
(b)
to give effect to the advice or rulings of the Shariah
Advisory Council.
(2)
In addition, the Bank may also specify standards relating to any of the following matters which do not require the ascertainment of
Islamic law:
(a)
Shariah governance including—
*NOTE—General savings–see subsections 111(2) and (3) of the Development Financial Institutions
(Amendment) Act 2015 [Act A1502] which comes into operation on 31 January 2016 and Savings in respect of prescribed institution carrying on Islamic financial business–see subsection 112(2) of the
Development Financial Institutions (Amendment) Act 2015 [Act A1502] which comes into operation on 31 January 2016.
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(i)
functions and duties of the board of directors, senior officers and members of the Shariah committee of a prescribed institution in relation to compliance with
Shariah;
(ii)
fit and proper requirements or disqualifications of a member of a Shariah committee; and
(iii)
internal Shariah compliance functions; and
(b)
any other matter in relation to the business, affair and activity of a prescribed institution for the purposes of compliance with Shariah.
(3)
Every prescribed institution, its director, Chief Executive
Officer, senior officer or member of a Shariah committee shall at all times comply with the standards specified by the Bank under subsections (1) and (2) which are applicable to such person.
(4)
Every prescribed institution shall at all times—
(a)
ensure that its internal policies and procedures on Shariah governance are consistent with the standards specified by the Bank under this section; and
(b)
whether or not standards have been specified by the Bank under this section, manage its business, affairs and activities in a manner which is not contrary to Shariah.
(5)
Every director, officer or a member of a Shariah committee of a prescribed institution shall at all times comply with the internal policies and procedures adopted by such institution to implement the standards specified by the Bank under subsection (1) or (2).
(6)
Any person who fails to comply with any standards specified under subsection (1), commits an offence and shall on conviction be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
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