South Africa Expands Islamic Finance Opportunities

It is proposed that the current legislation in respect of sukuk and murabaha financing will be extended to listed companies, within the 2015 Draft Taxation Laws Amendment Bill (TLAB) that South Africa's Ministry of Finance recently published for public comment. South African Sharia-compliant financing arrangements have been introduced in stages. Changes were made to the tax code to introduce sukuk bond financing arrangements, but these were restricted to the Government and public entities. This is now intended to be available to listed corporates from January 1, 2016. It is also proposed in the 2015 TLAB that it will be possible for listed companies (in addition to banks, as at present) to engage in murabaha financing.