SC issues practice notes relating to Syariah-based unit trust schemes
The Securities Commission (SC) today released two sets of practice notes relating to Syariah-based unit trust schemes to further enhance the quality of management and administration of such schemes.
These efforts are in line with the SC’s commitment to develop the Islamic capital market in Malaysia, as set out in the objectives of the Capital Market Masterplan.
Investment in Syariah-based unit trusts is one key area of participation in the Islamic capital market. There are presently 31 Syariah-based unit trust schemes in Malaysia.
The two practice notes, issued pursuant to the SC Guidelines on Unit Trust Funds, are:
- Practice Note 18 – Additional Requirements for Schemes Managed and Administered in Accordance with Syariah Principles (PN18); and
- Practice Note 19 – Procedures for Registration and Appointment of Syariah Committee Members/ Syariah Consultants for Schemes Managed and Administered in Accordance with Syariah Principles (PN19).
PN18 takes effect from 1 January 2003 while PN19 takes effect immediately, on 10 July 2002.
PN18 stipulates the roles of the scheme’s Syariah committee/Syariah consultant, investment committee as well as the trustee and compliance officer appointed to oversee the management of the scheme to ensure that a Syariah-based unit trust scheme is managed and administered in accordance with its objectives.
In addition, PN18 seeks to enhance the skills set of a scheme’s Syariah committee members to ensure that persons appointed in such capacity possess the necessary skills and abilities to perform their functions effectively.
PN19 sets out registration procedures for Syariah committee members/Syariah consultants of Syariah-based schemes. This is to provide an efficient and expedient framework for the appointment of Syariah committee members/Syariah consultants by Syariah-based schemes.
10 JULY 2002