Regulatory Alerts2021-05-27
Shariah Governance Rules for Finance Companies
The Saudi Central Bank (SAMA) issued the Shariah Governance Rules for Finance Companies to establish minimum standards and enhance compliance with Islamic Shariah principles across the Kingdom's finance sector. The Rules mandate clear roles for the Board of Directors, Senior Management, and specialized Shariah Committees, while requiring robust internal compliance and independent audit functions to ensure financing activities align with Shariah rulings. Effective January 1, 2023, the framework enforces committee independence, information confidentiality, and SAMA's supervisory authority to penalize non-compliance and exempt entities where appropriate.
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