Islamic Banks Commitment to Risk Information

Abstract

The research addresses the commitment of Islamic banks to disclose the risks accompanying their investment operations, highlighting the importance of this obligation as part of risk management and the protection of investors' rights. The study defines the concept of the obligation to disclose, emphasizing the absence of a clear legislative definition in Syrian laws, and explores the legal foundations based on general rules in civil law, consumer protection laws, and the legislative decree specific to Islamic banks.

The scope of the obligation revolves around the types of risks that must be disclosed, such as credit abuse risks, transferable commercial risks, and risks associated with financing structures like Mudarabah, Murabaha, and Musharakah. The research also examines the temporal scope of this obligation, noting that it is not limited to the pre-contract period but extends throughout the duration of the contract, reinforcing the principle of periodic and continuous disclosure.

The study provides a comparison of banking regulations in Syria, Malaysia, and the United Arab Emirates, highlighting Malaysia and the UAE's advanced mechanisms for risk disclosure and stringent penalties for violations. This underscores the need for Syrian legislation to develop its legal framework in this domain.

Among the key findings of the research is the absence of a clear legislative definition of the obligation to disclose in Syrian law. Additionally, it stresses the necessity of establishing clear legislative oversight and adopting modern technologies to enhance transparency. The study recommends implementing legal mechanisms to ensure good faith and improving local practices based on international experiences, contributing to increased customer trust in Islamic banks.