Regulatory Alerts2018-05-02
Added · Updated
BCEAO Instruction No. 005-05-2018 on Technical Characteristics of Islamic Finance Operations by Decentralized Financial Systems
This instruction defines the technical characteristics and contracts for Islamic finance operations that Decentralized Financial Systems (SFDs) are authorized to conduct within the West African Monetary Union (UMOA). It mandates that all such operations require a certificate from an internal Compliance Council and establishes specific rules for non-participatory financing (including Qardh, Mourabaha, Ijara, Istisna, Salam, Arboun, and Waad) and participatory financing (Moudaraba and Moucharaka). The document also regulates deposit and investment accounts, prohibiting interest-based remuneration and requiring profit-and-loss sharing, while stipulating that penalties for non-compliance must be donated to charity.
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