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Tokenised Islamic finance products: Shariah compliance meets digital innovation
Tokenisation, the representation of ownership interests and contractual rights as digital tokens recorded on distributed ledgers, is increasingly intersecting with Islamic finance. The opportunity is practical; broader market access, faster settlement, improved transparency and audability, and the potential to hard-wire compliance into product lifecycles. The challenge is equally clear. Structures must continue to satisfy foundational Shariah requirements prohibiting interest, excessive uncertainty and speculation, even as issuance, custody and secondary trading migrate to digital rails. Across the Gulf Cooperation Council (GCC) region, policymakers and market participants are moving beyond pilots to first-generation frameworks and transactions. Bahrain has adopted a stablecoin issuance and offering framework that embeds Shariah governance for Islamic-labelled products, while in the United Arab Emirates (UAE) the new CBUAE law (Federal Decree-Law No. (6) of 2025) provides a statutory pathway for "currency in digital form" as legal tender issued by the UAE Central Bank. This sts alongside the binding Higher Shariah Authority framework that adopts the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) standards for licensed Islamic Institutions. These measures signal a maturing regulatory environment for tokenised Islamic products.
For the purposes of this article, tokenised Islamic finance products refer to digital instruments structured to comply with the principles of Shariah and recorded on either permissionless public chains or permissioned networks operated by regulated institutions. They include security tokens, such as tokenised sukuk or equity interests; asset-backed tokens that evidence ownership in identifiable real assets or usufructs; and payment or utility tokens, including fiat-referenced stablecoins and bank deposit tokens used for settlement. Our primary focus is the GCC, in particular the UAE, Saudi Arabia and Bahrain. The analysis draws on standards and guidance issued by AAOIFI and the Islamic Financial Services Board. Where relevant, we refer to Federal Decree-Law No (6) of 2025 as “the new CBUAE law”.
Challenging the status quo: designated counsel and sponsor blacklists
In this article Michelle Gilmore-Parry explores the recent adoption of sponsor blacklists in European leveraged financings and discusses some key considerations for lenders.
22 November 2025Payback time: when lending agreements are silent on key terms
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22 November 2025An Englishman in New York: English law considerations in New York law credit agreements
English lawyers are sometimes required to consider how to weave points of English law and practice into New York law governed credit agreements to cater for the inclusion of an English credit party in what would otherwise be a US centric transaction. In this article the author looks at the several broad areas to consider when undertaking such an exercise, some of which may have material ramifications if not adequately addressed.
22 November 2025Security interests in digital assets under uniform law
This article discusses the treatment of security interests in digital assets under uniform law and highlights the lack of a harmonised international legal framework for their use as security for credit. Digital assets inherently transcend national borders, and the absence of a unified regime creates obstacles to their cross-border use, hindering international trade. While various uniform law texts address aspects of security interests in digital assets, they fail to provide comprehensive global unification due to differences in scope, terminology and operative rules. The UNCITRAL Model Law on Secured Transactions (STML) offers a general framework for security interests in movable assets, but it requires updates to address specific issues related to digital assets. The article emphasises the importance of updating the STML to remove barriers to the use of digital assets as security for credit and to facilitate international trade.
25 October 2025Reassessing the Quincecare duty: anti-money laundering obligations and the boundaries of authorised payments
The UK Supreme Court’s decision in Philipp v Barclays Bank UK plc has clarified the nature and scope of the so-called Quincecare duty, but significant uncertainties remain. This article explores two aspects of the duty: first, how anti-money laundering obligations intersect with the Quincecare duty; and second, in what circumstances a payment should be treated as properly authorised.
25 October 2025The FCA’s safeguarding reforms for payments and e-money firms: an update
The Financial Conduct Authority (FCA) believes clients of payments and e-money firms are exposed to unacceptable risks due to poor safeguarding practices across the sector. The FCA has now published final rules and guidance to address these in PS25/12. The interim-state rules have been modified in several respects, including removing the need for reconciliations on non-working days and exempting firms who have not safeguarded relevant funds from the audit requirement. The implementation period for these changes has been extended from six to nine months. The end-state rules, which included a statutory trust and abolition of the so-called “D+1 rule”, have been paused due to stakeholder concerns.
25 October 2025Managing currency risk in emerging Asia investment: towards diversification
Nicola Yeomans undertakes a review of existing legal and financial mechanisms for managing currency risk in private capital investment into emerging Asia and assesses the 2024 ABAC recommendations for alternative mechanisms for managing the risk through a bond linked to a diversified basket of currencies.
25 October 2025Arbitration and insolvency in a sliding, multi-creditor context: Sapura and other common law approaches
A recent Singaporean case, Sapura Fabrication Sdn Bhd and Others v GAS and Another Appeal [2025] SGCA 13, provides welcome guidance on when arbitral proceedings can be carved out from a domestic restructuring and insolvency process. Continuing the debate about the clash between arbitration and insolvency, Sapura adds two new dimensions: the multi-creditor context and a sliding timescale. This article examines how best to interpret these novel elements in light of the spirit of the insolvency regime, namely facilitating the fair administration of assets according to creditors’ legal entitlements rather than a free-for-all favouring the most well-resourced and well-advised.
25 October 2025Misrepresentation and the constructive trust: a hunt for clarity
This article addresses the debate which has arisen from Lord Browne-Wilkinson’s much cited dictum that equity imposes a constructive trust on a fraudulent recipient whenever property is obtained by fraud. It explores the rationale for the imposition of a constructive trust in the context of the underlying legal principles and considers how those principles have been approached in the key authorities. In an effort to identify a coherent rationalisation of the authorities, it then focuses on the decision in Halley v Law Society and addresses whether that decision can be reconciled with other authority, particularly the recent Supreme Court decision in Philipp v Barclays Bank UK plc .
25 October 2025
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