THE PROHIBITION OF RIBA UNDER ISLAMIC LAW: WHAT ARE THE IMPLICATIONS FOR INTERNATIONAL CONTRACTS?

Transcription

1 THE PROHIBITION OF RIBA UNDER ISLAMIC LAW: WHAT ARE THE IMPLICATIONS FOR INTERNATIONAL CONTRACTS? Alache Fisho-Oridedi* ABSTRACT: The doctrine of prohibition of interest payments riba under Islamic law has had significant effect on international transactions with Islamic law flavour. The applicability of this prohibition to international contracts has been the source of much debate within the international commercial community and across the various schools of Islamic law. The need for the structuring of business transactions to adhere to the dictates of Islamic law while ensuring that the transaction remains profitable and beneficial to the parties has led to the evolution of various transactional models that are applied in the Islamic states. This study focuses on the concept of prohibition of riba in a bid to understand its applicability in modern international business transactions. In conducting this research I have adopted an analytical and historical approach and conclude that the concept of prohibition of riba remains a current doctrine widely applied throughout the Muslim community albeit not uniformly. Thus a good understanding of this concept is required by persons involved in transactions involving Islamic law and the transaction must be structured to conform to the dictates of Islamic law in order to make them legally enforceable. *The author is a Senior Legal Officer in the Commercial Law Department of the Nigerian National Petroleum Corporation. A Barrister and Solicitor of the Supreme Court of Nigeria, she has a strong bias for commercial contracting and legal project support in the Oil and Gas Industry. She is currently a postgraduate student of CEPMLP University of Dundee, Scotland, where she is pursuing an LLM Degree in Petroleum Law and Policy. alache.fisho-oridedi@nnpcgroup.com

2 TABLE OF CONTENT Page 1. INTRODUCTION.3 2. OVERVIEW OF ISLAMIC LEGAL SYSTEM Sources of Islamic Law Primary Sources Secondary Sources Other Sources Schools of Islamic Jurisprudence and their views on Riba THE PROHIBITION OF RIBA IN CONTRACTS UNDER ISLAMIC LAW Overview of Islamic Law of Contract Prohibition of Riba under Islamic Law Contracts for Sale of Goods Loan Agreements Riba Transactions in Islamic Law Jurisdictions Transactions with Non-Muslims EFFECT OF PROHIBITION OF RIBA ON INTERNATIONAL TRANSACTIONS Modern trends in International Transactions under Islamic Law Emergence of Islamic Banking Islamic Project Finance Mudaraba Muradabah Musharaka CONCLUSION...17 BIBLIOGRAPHY 2

3 1. INTRODUCTION International business transactions by their very definition are transactions that transcend national, regional and international borders. The complexities of the contractual relations flowing from these transactions often give rise to peculiar transactional practices and norms in the various jurisdictions in which the different rights and obligations of a contractual relationship exist. These norms and practices range from those attributable to the juristic doctrines of the different schools of comparative law to those attributable to the application of a juristic system based on religion as is found in Islamic states. Historically, trade in the largely Muslim Persian Gulf flourished primarily amongst adherents of the faith who by virtue of a common belief system, generally enjoyed consensus on the peculiar commercial terms of the transaction as dictated by the prevailing Islamic law. However the discovery of natural resources in the region led to an explosion of international trade and commerce with the attendant dilution of the application of Islamic law principles of business. Western investors who invested in the region were often in a superior commercial position having the investment funds as well as the technical know-how for the transactions. Thus these investors dictated the terms of the transaction and determined the governing law of such contracts which rarely would be Islamic law. Following an era of economic nationalism in the early 1960s, many of the states in the Persian Gulf in a bid to assert control over their natural resources and harness the benefits there from, embarked on wide-spread nationalisation/expropriation of foreign interests and there was a shift in the transactional dynamics as the states gained the 3

4 advantage position. Coinciding with this era was a resurgence of Islamic thinking and a global rebirth of the Islamic system. 1 Many Islamic states began to insist on the application of the Sharia a in their regions and sought the conformity of all commercial transactions both domestic and international with the dictates of Islamic law. One of the fundamental principles of Islamic commerce is the prohibition of riba which is translated as interest, undue profits or excessive gain from a transaction. The application of this principle has far-reaching effects on the transactional dynamics of international contracts concluded under Islamic law. While its effect is sometimes felt in contracts for the sale of goods particularly where there is delay in the payment for goods, the most obvious impact is on the financing of transactions. In conventional western style banking, a transaction is financed by a bank on the understanding that the capital lent to the customer would be repaid plus interest at a rate agreed beforehand as an additional compensation taking into account the time value of money and the value of the service of lending. This type of transaction is prohibited as riba under Islamic law and consequently transactions so financed may be declared void or voidable in Islamic law jurisdictions. While usury is regarded negatively in most parts of the world, what is typically frowned upon is excessive interest charges and not the payment of interest as a whole. Under Islamic law however, the payment and receipt of interest riba- is strictly prohibited as the application of interest is regarded as an act of exploitation and injustice and therefore inconsistent with Islamic concepts of fairness and justice. Although the prohibition of riba is universally applicable within Muslim 1 Sharawy, H., Understanding the Islamic Prohibition of Interest: A Guide to Aid Economic Cooperation between The Islamic and Western Worlds, 29 Ga. J. Int l & Comp. L

5 communities, the scope of its application within financial transactions is not as easily defined. The question become not really the prohibition of riba, but what qualifies as riba and how does its prohibition affect international trade in Islamic states? The paper commences with an overview of the Islamic legal system and examines the issue of riba and its effect on international contracts. The paper adopts a historical and analytic approach in addressing the issues raised and concludes that the prohibition of riba has far reaching effect on contractual relationships entered into in Islamic law states and it must be carefully considered by investors seeking to do business in Islamic states and the transactions structured to accommodate the dictates of the sharia a and ensure compliance therewith. 2. OVERVIEW OF THE ISLAMIC LEGAL SYSTEM Islamic law also known as Sharia a is regarded by its adherents as a divinely ordained system of law which has roots in the pre-islamic customary laws and norms of the Arabs of the Persian Gulf states. 2 Islamic law is derived primarily from the Quran which is the holy book of Islam and the sayings and practices of Prophet Mohammed. 2.1 Sources of Islamic law Most Muslim scholars agree on the general classification of the sources of Islamic law into primary sources which consist of the revealed sources and secondary sources which are the unrevealed sources. It is worthy to note that the sources of Islamic law 2 See further Khadduri, M., Nature and Sources of Islamic Law, 22 Geo. Wash. L. Rev

6 are hierarchical in nature with the Quran resting unchallenged at the pinnacle. 3 The main sources of Islamic law and a selection of the other secondary sources are described below Primary Sources The Quran The Quran is the first and most important of the sources of Islamic law. It is considered to be the direct words of God revealed to and transmitted by the Prophet Mohammad. Indeed as stated by Khan in his article: To Muslims, the Quran being the very word of God, it is the absolute authority from which springs the very conception of legality and every legal obligation. As the highest source of Islamic law, all other sources must conform to the Qur'an. Indeed the other sources only become tenable in situations where the Quran does not address an issue directly. Sunnah: These are also referred to as hadiths and are the traditions or known practices of the Prophet Muhammad. This source includes many things that he said, did, or agreed to. It also includes rulings or judgements passed by Prophet Mohammed on various matters which were reduced into writing for future reference. Many issues concerning personal conduct, community and family relations, political matters, etc. were 3 Also See Khan, K., Juristic Classification of Islamic Law, 6 Hous. J. Int l L

7 addressed during the time of the Prophet, decided by him, and recorded. The Sunnah can thus clarify details of what is stated generally in the Qur'an Secondary Sources Qiya In cases when something needs a legal ruling, but has not been clearly addressed in the Quran or Sunnah, judges may use analogy, deduction and legal precedent to decide new case law. Quite obviously, the application of reasoning and deduction in a case often leads to the adoption of accepted principles established in earlier cases. This source has been compared with the Common law doctrine of judicial precedence. 4 Ijma This is a consensus agreement on an issue by eminent Muslim jurists/theologians in situations when a specific authority on the issue is absent in the Qur'an or Sunnah. Ijma is developed from diverse opinions of jurists based on the Quran and/or Sunnahs which over time consolidate into a consensus on the issue under consideration. Ibrahim in his paper states that once a consensus has been established it becomes a binding authority and cannot be repealed by another consensus. 5 Consensus in this instance therefore has the effect of creating substantial law. 6 4 Ibid 5 Ibrahim, A., The Rise of Customary Businesses in International Financial Markets: An Introduction to Islamic Finance and The Challenges of International Integration, 23 Am. U. Int l L. Rev , p Hassan, F., The Sources of Islamic Law, 76 Am. Soc y Int l L. Proc , p. 67 7

8 2.1.3 Other Sources: There are other sources of Islamic law whose classification lack universal acceptance amongst the various schools of Islamic jurisprudence. They are often based on the discretion of the judge and application of principles of equity, justice, fair-play and morality and so are open to interpretation. Since these are subjective terms, it goes without saying that the application will differ based on the personal bias of each individual judge. Perhaps this is the reason for the non-acceptance of some of these sources by some schools of jurisprudence. Examples are isthisan - based on the personal choice of a judge to achieve justice [equity]; istislah - the desire to reach a good or beneficial result and avoid a harsh judgement and istidlal and istishab which are pronouncements on public policy based on judicial discretion Schools of Islamic Jurisprudence As the practice of Islamic thought progressed through time, it highlighted the differences in interpretation of the dictates of the Quran and this led to the establishment of various schools of Islamic jurisprudence. At some point there were over 50 of such schools, but currently the two main sects of Muslim jurisprudence are the Sunni and the Shiite sects which are each subdivided into four schools of Islamic thought. 8 The four Sunni schools are the Hanafi, Shafi i, Maliki and Hanbali while the four Shiite schools are the Ibadi, Zaydi, Ithna and Imami. These schools were named after eminent Muslim scholars who evolved peculiar theories of legal assumptions and methodologies which were further developed by their students. 7 Ibid, at p Childress, C., Saudi-Arabian Contract Law: A Comparative Perspective, 2 St. Thom. L. F , p 74. 8

9 The Majority of the Muslims around the world are Sunnis [prevalent in Saudi Arabia, U.A.E., North Africa, Turkey and Central Asia) while about 10-15% are Shiites [Iran, Iraq, Central and South Asia). 9 While the two sects share many common beliefs such as the supremacy of the Quran and adherence to the five pillars of Islam, there are fundamental difference in their interpretation of some verses of the Quran, acceptability of some of the Sunnahs and the application of the doctrine of riba. 3. COMMERCIAL TRANSACTIONS UNDER ISLAMIC LAW AND THE PROHIBITION OF RIBA It is specifically stated in an early revelation in the Quran that God hath permitted trade and forbidden usury. 10 This restriction is anchored on the principle that the earning of an unjustifiable profit at the expense of another is an exploitative act. Furthermore, the concept of wealth accumulation in Islam reveals that it is haram [forbidden] in Islam to accumulate wealth that is not a product of work. Thus wealth that is generated from the payment of interest qualifies as haram and is expressly prohibited in the Quran. 11 An understanding of this concept clarifies why although Islamic law is primarily targeted at such areas as family, inheritance and criminal law, 12 the applicability of Islamic law to commercial transactions is becoming more prevalent as the financial community in Islamic law states strive to bring these transactions in to conformity with the dictates of Islamic law. 9 See Blanchard, C., Islam: Sunnis and Shiites, Congressional Research Service, Jan. 2009, available at [last visited 13 th July 2009). 10 the Quran, Quran 4: Childress, C., supra note 8. 9

10 3.1 Overview of Islamic Law of Contract Two fundamental principles of Islamic law of contract are the concepts of riba and ghahar. While riba is the prohibition of the payment of usury or interest on a transaction, ghahar refers to the prohibition of gambling, speculation and unreasonable uncertainty in a commercial transaction. The word riba is derived from the Arabic verb raba which means to increase, grow or rise above. 13 Although riba generally refers to usury, some Muslim scholars have given it a much wider scope to cover any increase in wealth and/or income that results from the lending of money or the exchange of fungible goods. 14 The literal translation of ghahar is fraud but the conceptual translation usually refers to risk, uncertainty or hazard. 15 The prohibition of ghahar stems from the Quranic prohibition of games of chance and therefore under Islamic law, transactions having an element of speculation are frowned upon. In practice, contractual relations that fail to clearly define the existence and availability of the object and the consideration of the contract will be categorized as speculative transactions and therefore will be prohibited Prohibition of Riba under Islamic Law This is one of the most significant principles in Islamic finance and thus is key to the successful implementation of any commercial transaction. This principle of 13 Shihata, I., Some Observations on the Question of Riba and the Challenges Facing Islamic Banking, 5 Y.B. Int l Fin. & Econ. L , p Ibid 15 Kamali, M., Islamic Commercial Law; An Anlysis of Futures and Options, (Islamic Texts Society; Cambridge, England, 2000), pp Hassan, K. & Lewis, M., Handbook of Islamic Banking, (Cheltenham, UK: Edward Edgar Publishing Limited, 2007). 10

11 prohibition of riba has universal application across the different schools of Islamic jurisprudence and has remained relevant in current day. However, the interpretation of the concept of riba is controversial Contracts for Sale of goods (riba al-buyu) Under Islamic law, a sale is described as the exchange of a thing of value by another thing of value with mutual consent. 17 Certain conditions precedent are inherent in a contract for the sale of goods: the goods must be in existence at the time of sale; the seller must have ownership of the goods as well as physical possession, the sale must be instant and not deferred to a future day, delivery and price must be certain and the sale must be unconditional. The terms and conditions of the sale must be compliant with the above and a seller must state clearly the cost of production of the goods and the profit margin he is adding on to the cost in order to ensure that the contract does not contravene the prohibition of riba interpreted in this case as excessive profits. The consequence of entering into a contract tainted by Riba is that such a contract will not be enforced by a court. An application of equitable remedies by the court may result in the parties being restored to their original positions Loan Agreements (riba al-nasi a) Islamic law prohibits the payment of interest on loans obtained by a borrower from a lender on the grounds that such interest payments are forbidden as riba in the Quran. 17 Usmani, M., An Introduction to Islamic Finance, [The Hague: Kluwer Law International, 2002), p Sloane, P., The Status of Islamic Law in the Modern Commercial World, 22 Int l L

12 The argument put forward by jurists is that the pre-determined interest charged by a lender represents a gain that is risk-free and not attributable to any work or risk on the part of the lender. A loan of currency is recognised under Islamic law and referred to as qard and interest payments on such a loan may be permissible if it is proven that such interest payments were made willingly by the borrower and were not a condition of the qard. 19 It is my opinion that perhaps a distinction of the concept of a loan should be made as it appears that the original concept for the prohibition of riba was based on the protection of a poor borrower from unreasonable and usurious repayment terms. In modern transactions however, loans are used as working capital and money to make more money. It appears therefore that it does no moral injustice for a lender to be able to receive uplift or a return on his money in view of the concept of time value of money and for the service rendered in loaning the money Riba Transactions in Islamic Jurisdictions Some Islamic countries have accepted the inclusion of some interest payments in commercial transactions in their jurisdiction while others strictly prohibit same. In the United Arab Emirate (UAE), the application of interest in some commercial transactions is legal. In Iran however, such transaction will be illegal and void on the basis of the prohibition of riba. 20 It is interesting to note that this illegality does not extend to banking operations outside Iran as it appears that Iranian banks do receive 19 Saleh, N., Unlawful Gain and Legitimate Profit in Islamic Law, (Cambridge: Cambridge University Press, 1986), p Ansari-pour, M., Interest in International Transactions Under Shiite Jurisprudence, 9 Arab L. Q. 1994, p

13 and pay interest on foreign transactions. 21 Banks also pay interest inside Iran. The only effect of the prohibition is changing the name of interest to profit Transactions with non-muslims Does the prohibition of riba apply to transactions between Muslims and non- Muslims? The general rule under Islamic law is that where the transaction is conducted within an Islamic state, riba will be prohibited. However as to the question where the transaction is conducted outwith the Muslim state, the Hanbali school is of the opinion that riba within this transaction will not be prohibited. The other schools hold different view on this. 22 One of the views is based on the principle that property of non-muslims is not protected under Islamic law and therefore it would not amount to an injustice or haram to apply interest in transactions involving non-muslim parties. 4 EFFECT OF PROHIBITION OF RIBA ON INTERNATIONAL TRANSACTIONS 4.1 Modern trends in International Transactions under Islamic Law The prohibition of interest payment has been settled firmly in Islamic law as the various schools agree on the fundamental principle that the payment of interest is prohibited in the Quran. However in these jurisdiction, different models of contractual arrangements have evolved over the years that while remaining in conformity with the dictates of Islamic law, ensure that an investor in a transaction earns some return on his capital invested in that transaction. This has resulted in the emergence of Islamic banking as a niche service provider and Islamic project finance, a method of financing 21 Ibid, p Saleh, N., Unlawful Gain and Legitimate Profit in Islamic Law, (New York: Cambridge University Press, 1986) 13

14 a project that applies the returns from the project to the repayment of loans structured for the carrying out of the project. In this section, we will examine some of the more popular models of commercial transactions obtainable across the Muslim society. 4.2 Emergence of Islamic Banking The concept of Islamic banking which was birthed in the last 30 years has evolved to become a viable segment of the international banking market. Islamic banking is concerned with the development and promotion banking products tailor-made for the Islamic society which conform to Islamic principles, law and traditions while providing similar incentives to products utilised in conventional interest-based banking. Since wealth accumulated without work is classified as haram, one may simplistically conclude that the implementation of an interest-free banking system would be impossible because of the calculation of interest payment on loans obtainable from a bank. However, Islamic law fundamentally recognises the principle of shared risk as work entitling a financial institution to an addition on the principal sum that was advanced. 23 In essence, an Islamic bank should share in the risk with the entrepreneur...islamic banking implies zero rate of interest but not zero rate of return The first truly Islamic bank was established in Mit Ghamr, Egypt in Currently there are about 200 Islamic banks operating in over 70 countries which include 23 See Sharawy, H., Understanding the Islamic Prohibition of Interest, 2 Ga. J. Int l & Comp. L , p Siddiqui, S.H., Islamic Banking: Genesis & Rationale, Evaluation & Review, Prospects and Challenges (Karachi, Pakistan : Royal Book Co., 1994), p

15 Muslim and non-muslim countries with a portfolio of over USD200billion. 25 In Pakistan, Sudan and Iran for example, there has been a national transition of the banking system from a western-styled to an Islamicised system of banking. In August 1983, a new banking law was enacted in Iran that enforced the complete abolition of interest by March 1985 In Iran it was only in the shape of changing names. In Sudan, by a directive of the Central Bank issued in December 1984, all commercial banks were required to stop dealing with interest and to negotiate the conversion of existing interest-bearing deposits into investment deposits in accordance with Islamic law. Foreign transactions were to continue on the basis of interest until an alternative way became available Islamic Project Finance A major development pursuant to the emergence of an Islamic banking system is the evolution of Islamic project finance. The term project finance refers to a model of financing in which debt and equity plus a level of credit enhancement are combined for the development of a capital intensive project and the repayment of the loan is made primarily from the project revenue. 27 In conventional western style banking, the terms of the loan agreement will inevitably include payment of interest on the capital sum at a fixed and agreed rate. Since Islamic law prohibits the payment of interest, Islamic banks have developed different financial products that achieve the aims of project finance without 25 Islamic Institute of Islamic Banking and Insurance, The Islamic Banking System, Status of Islamic Banking Today (2003), (last visited 28 th July, 2009). 26 Rachagan, A., Islamic Banking in Malaysia, JIBRL Hoffman, S., The Law and Business of International Project Finance, (2 nd Edition), (New York, U.S.A.: Transnational Publishers Incorporated, 2001), p. 6 15

16 contravening the dictates of Islamic law. Some of the more popular of these products are examined below Mudaraba This is a form of trust financing where the bank acting as investor, provides all or most of the funds required for the facilitation of a project and the entrepreneur provides as his share of the risk allocation the expertise and technical know-how for the facilitation of the project. Profits derived from the revenues of the investment are split between the bank as investor and the entrepreneur in a predetermined ratio which may involve decreasing participation by the bank as the capital sum is recovered. Where there is no profit, the bank loses its capital investment and the entrepreneur loses the right to share in the profits. 28 This model was used in Saudi Arabia by the Islamic Development Bank for the financing of a US$1.5 billon infrastructure fund Murabadah This is often referred to as cost-plus financing. In this model, the lending bank purchases the product which the borrower requires and resells such products to the interested party at cost plus a mark-up. The bank must clearly state in the loan documents what its cost was and the mark-up applied on the price in other to ensure that the transaction is in conformity with the dictates of the law. This form of financing is usually employed for short-term facilities with tenors of between one to 28 Seniawski, B., Riba Today: Social Equity, the Economy and doing Business Under Islamic Law, 39 Colum. J. Transnat l L , p Ibid 16

17 five years and was used in Algeria for the financing of gas turbine engines for a power plant project Musharaka Islamic financial institutions refer to this model of financing as participation finance. In project finance, this translates to an arrangement that is quite similar to the traditional joint venture structure where partners to a project have joint investment, decision making and profit sharing rights. The lender bank therefore becomes a partner to the transaction and is therefore entitled to a share of the profits received by the project. The Saudi British Bank in 1997 structured a US$72 million musharaka facility for a group in Saudi Arabia and the funds were used for the financing of the purchase of cars by individual customers of the group Conclusion As the world experiences globalisation and international trade continues to grow, it is inevitable that challenges arising from the application of the prohibition of riba will arise particularly when one of the parties is a subject of Islamic law jurisdiction. When one considers that the Persian Gulf holds about 75% of the entire crude oil reserves in the world, it is clear that international trade will continue to grow in the region in the future. This means therefore that an understanding of the transactional dynamics of commercial transactions under Islamic law is an essential tool for business in the region. 30 See Bilal, G., Islamic Finance: Alternatives to the Western Model, 23 Fletcher F. World Aff. 145, 158 (1999). 31 Supra note 25, p

18 The prohibition of riba under Islamic law is probably the most important principle of commercial transaction under Islamic law. The management of the application of this principle in international transactions is very important and has led the financial community in Islamic law states to develop products that though in practical terms operate and have the same effect as interest charges in conventional style banking, are structured in such a way that they do not run afoul of the dictates of Islamic law. Investors in Islamic states must of necessity have a grasp of the concept and transactions must be structured to conform to the dictates of Islamic law as applicable in the different jurisdictions as regards the prohibition of riba. Also in the personal opinion of the writer, perhaps Islamic law jurists should open the arena of discourse on the need for a distinction between interest payments on personal loans and interest charges on loans advanced for commercial purposes. 18

19 BIBLIOGRAPHY BOOKS Hallaq, W., The Origins and Evolution of Islamic Law, (Cambridge: Cambridge University Press, 2005) Hassan, K. & Lewis, M., Handbook of Islamic Banking, (Cheltenham, UK: Edward Edgar Publishing Limited, 2007) Iqbal, M. & Llewellyn, D., New Perspectives on Profit Sharing and Risk, (Cheltenham, UK: Edward Edgar Publishing Limited, 2002) Saleh, N., Unlawful Gain and Legitimate Profit in Islamic Law, (Cambridge: Cambridge University Press, 1986) Usmani, M., An Introduction to Islamic Finance, (The Hague: Kluwer Law International, 2002) Siddiqui, S.H., Islamic Banking: Genesis & Rationale, Evaluation & Review, Prospects and Challenges (Karachi, Pakistan : Royal Book Co., 1994), p. 49. ARTICLES Ansari-pour, M., Interest in International Transactions under Shiite Jurisprudence, 9 Arab L. Q Bilal, G., Islamic Finance: Alternatives to the Western Model, 23 Fletcher F. World Aff. 145, 158 (1999) 19

20 Childress, C., Saudi-Arabian Contract Law: A Comparative Perspective, 2 St. Thom. L. F Hassan, F., The Sources of Islamic Law, 76 Am. Soc y Int l L. Proc Ibrahim, A., The Rise of Customary Businesses in International Financial Markets: An Introduction to Islamic Finance and The Challenges of International Integration, 23 Am. U. Int l L. Rev Khadduri, M., Nature and Sources of Islamic Law, 22 Geo. Wash. L. Rev Khan, K., Juristic Classification of Islamic Law, 6 Hous. J. Int l L Rachagan, A., Islamic Banking in Malaysia, JIBRL 88 Seniawski, B., Riba Today: Social Equity, the Economy and doing Business under Islamic Law, 39 Colum. J. Transnat l L Sharawy, H., Understanding the Islamic Prohibition of Interest: A Guide to Aid Economic Cooperation between the Islamic and Western Worlds, 29 Ga. J. Int l & Comp. L Shihata, I., Some Observations on the Question of Riba and the Challenges Facing Islamic Banking, 5 Y.B. Int l Fin. & Econ. L , p.25 Sloane, P., The Status of Islamic Law in the Modern Commercial World, 22 Int l L INTERNET SOURCES Blanchard, C., Islam: Sunnis and Shiites, Congressional Research Service, Jan. 2009, available at [last visited 13 th July 2009) Islamic Institute of Islamic Banking and Insurance, The Islamic Banking System, Status of Islamic Banking Today (2003), (last visited 28 th July, 2009) 20