Labuan Islamic Financial Services and Securities Act 2010 · Updated to 15 Oct 2022 · Part VI · Labuan Islamic Banking
61. Labuan Islamic banking business to be carried on only under licence
Feedback & supportSubject to subsection (2), no person shall carry on Labuan
Islamic banking business other than the Labuan Islamic investment banking business unless—
Labuan Islamic investment banking business
“Labuan Islamic investment banking business” means any of the following business: (a) providing financing facilities in compliance with Syariah principles; (b) providing consultancy and advisory services relating to corporate and investment matters, including dealing in securities, or making and managing investments, on behalf of any person, in compliance with Syariah principles; (c) undertaking foreign exchange transactions, profit rate swaps, dealings in Islamic derivative instruments or Islamic derivative financial instruments which are in compliance with Syariah principles or any other similar risk management activities; (d) Labuan Islamic financial business; or (e) such other business as the Authority, with the approval of the Minister, may specify, *NOTE—The Exchange Control Act 1953 has since been repealed by the Financial Services Act 2013 which comes into operation on 30 June 2013—see sections 271 and 272…
it is a Labuan company or a foreign Labuan company, established or registered for the sole and exclusive purpose of carrying on Labuan Islamic banking business in any location permitted by the Authority; or
it is a Malaysian bank, and holds a valid licence to carry on such business.
Subsection (1) shall not apply to a Labuan bank unless the
Labuan bank
“Labuan bank” means a person who is licensed to carry on Labuan banking business under Part VI of the Labuan Financial Services and Securities Act 2010;
Labuan bank obtains the prior approval of the Authority to carry on Labuan Islamic banking business.
Any person who contravenes subsection (1) commits and offence and shall, on conviction, be liable to a fine not exceeding ten million ringgit or to imprisonment for a term not exceeding five years or to both, and in the case of a continuing offence, shall, in addition, be liable to a daily fine not exceeding ten thousand ringgit for each day the offence continues to be committed.
*NOTE—The Exchange Control Act 1953 [Act 17] has since been repealed by the Financial
Services Act 2013 [Act 758] which comes into operation on 30 June 2013—see sections 271
and 272 of Act 758.
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