Section 36
Substitution of Division 6 of Part VI
of Capital Markets and Services (Amendment) Act 2015
The principal Act is amended by substituting for Division 6
of Part VI the following Division:
“Division 6
Islamic capital market products, Islamic securities, etc.
Subdivision 1 — General
Interpretation
Quoted provision
Section 316
In this Division, unless the context otherwise requires—
“Islamic derivatives” means derivatives structured in compliance with Shariah principles;
“Islamic structured product” means a structured product structured in compliance with Shariah principles;
“structured product” has the same meaning as provided in the Commission’s guidelines in respect of structured products;
“Islamic capital market product” means—
(a)
Islamic securities;
(b)
a unit trust scheme structured in compliance with
Shariah principles;
(c)
Islamic derivatives;
(d)
a private retirement scheme structured in compliance with Shariah principles;
(e)
any product or arrangement which is based on securities or derivatives, or any combination thereof structured in compliance with Shariah principles; or
(f)
any other product which the Minister may prescribe under section 5 as an Islamic capital market product;
“Islamic securities” means—
(a)
shares in a body corporate or an unincorporated body, which are classified as Shariah-compliant by the
Shariah Advisory Council;
(b)
units in a unit trust scheme or prescribed investments structured in compliance with Shariah principles;
(c)
an Islamic structured product; or
(d)
sukuk structured in compliance with Shariah principles, and includes any right, option or interest in respect thereof which is in compliance with Shariah principles;
“sukuk” has the same meaning as provided in the
Commission’s guidelines in respect of Islamic securities.
(2)
Subject to subsection (1), Islamic securities do not include any Islamic Negotiable Instruments that fulfill the following conditions:
(a)
the issuance of the Islamic Negotiable Instrument is by an eligible licensed institution or Islamic bank that is in compliance with any standard issued by Bank Negara under the Islamic Financial
Services Act 2013 [Act 759] which is applicable to
Islamic Negotiable Instruments; and
(b)
the maximum tenure of the Islamic Negotiable Instrument does not exceed five years.
Subdivision 2 — Islamic capital market products
Islamic capital market products 316a. (1) An Islamic capital market product is a capital market product for the purposes of securities laws.
Capital Markets and Services (Amendment)
(2)
The Commission may specify in the guidelines made under section 377 on the following:
(a)
any model agreement or documentation relating to a transaction or arrangement in respect of Islamic capital market products;
(b)
the duties and responsibilities of the different parties involved in a transaction or arrangement in respect of Islamic capital market products; and
(c)
any other matter as may be deemed appropriate, in giving full effect to the principles of Shariah in relation to a transaction in respect of Islamic capital market products.
Subdivision 3 — Islamic Securities
Islamic securities 316b. (1) Islamic securities are securities for the purposes of securities laws.
(2)
Any proposal, scheme, transaction, arrangement, activity, product or matter relating to Islamic securities shall comply with the relevant requirements under securities laws and guidelines issued by the Commission.
Prescription by Minister in respect of Islamic securities,
Quoted provision
Section 316c
Islamic derivatives or Islamic capital market product, etc.
Where the Minister has made a prescription under section 5 in respect of Islamic securities, Islamic derivatives or Islamic capital market products, the Minister may make such modifications in the prescription on the usage of expressions in the securities laws as may be necessary to give full effect to the principles of Shariah in respect of such Islamic securities, Islamic derivatives or Islamic capital market products.
Application of Division 4 of Part VI of this Act 316d. Any reference to the “borrower” in Division 4 of
Part VI of this Act shall be construed as a reference to an
“issuer of sukuk” or “issuer of an Islamic structured product”
for the purposes of the application of those provisions to sukuk or Islamic structured product.”.