Constraints on Islamic Banking Within European and Czech Legal Framework

Title Constraints on Islamic Banking Within European and Czech Legal Framework Author Hynek Mádl Keywords Islamic banking, credit, Sharī'ah board, Murabaha, Musharakah Summary Islamic banking is a sector of financial market which was formed in the 1970s and since then, it has spread outside Muslim countries too. The difference between Islamic banking and conventional banking is in the fact that all activities of Islamic banks shall be consistent with the principles of Islamic law. The submitted thesis aims to find and analyse obstacles of implementing Islamic banking, resulting from its singularities, in the European and Czech legal framework. In the introduction, the author shortly describes theoretical principles of Islamic banking and ways in which contemporary practices of Islamic banks have deviated from these principles. The next part of the thesis lays out individual characteristics of Islamic banking. Using the examples of specific finance models (especially Murabaha and Musharaka financing), these features are assessed from the viewpoint of their compliance with legal regulation of banks and their activities. The process in which a bank provides financing to its clients by acquiring and disposing assets, which such financing applies to, is considered to be the most disputable element of Islamic..