Kuala Lumpur, 7 May 2008
New SC guidelines and best practices to raise standards of Islamic venture capital industry
The Securities Commission (SC) today introduced a set of new guidelines and best practices to promote the adoption of appropriate standards for the development of the Islamic venture capital industry.
The release of the Guidelines further enhances Malaysia’s comprehensive and highly regarded regulatory framework for the ICM. The Guidelines and Best Practices on Islamic Venture Capital (Guidelines) stipulate the minimal requirements for the establishment of an Islamic venture capital corporation (VCC) and Islamic venture capital management corporation (VCMC). The Guidelines also include a set of Best Practices in an effort to promote appropriate Islamic standards in the industry.
Under the new Guidelines, a Shariah adviser must be appointed for the establishment of an Islamic VCC or VCMC. In addition, the activities of the Islamic venture capital entities must be Shariah compliant.
Consistent with SC’s efforts to promote high standards in the Islamic venture capital industry, the Best Practices for the Islamic VCC or VCMC are voluntary in nature and reflect the level of expectations from the SC. The Best Practices cover the responsibilities of the Shariah adviser, appointment and roles of a compliance officer, and other administrative matters relating to portfolio management and maintenance of accounts. The adoption of these best practices will raise the standards of the Islamic venture capital industry, and enhance professionalism in the industry.
The release of the Guidelines, which was announced at the Islamic Venture Capital and Private Equity Conference 2008 held in Kuala Lumpur today, set the benchmark for both the Islamic venture capital industry and is intended to promote the growth of the industry.
The Guidelines and Best Practices, which took effect on 7 May 2008, are available here.