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Sabana Shari’ah Compl iant REIT is managed in
accordance with Shari’ah investment principles and
procedures, which are consistent with principles of
Islamic law and general considerations of ethical
investments in terms of social responsibility in asset
selection and structuring.
Sabana Shari’ah Compliant REIT is required to ensure
that the total rental income from lessees, tenants and/
or sub-tenants engaging in activities which are non-
permissible under the Shari’ah investment principles,
which include activities relating to conventional financial
and insurance services, gaming, non-halal production,
tobacco-related products, non-permitted entertainment
activities and stock-broking in non-compliant securities
does not exceed 5.0% per annum of the gross revenue
of Sabana Shari’ah Compliant REIT’s portfolio of
properties.
Sabana Shari’ah Compliant REIT donates non-Shari’ah
rental income to charitable causes on a quarterly basis.
Thus far, the non-Shari’ah income represents less than
0.3% of the gross revenue.
Islamic finance and investment is growing in importance
globally and across Asia. Recent data by Deutsche Bank
predicted that global Islamic banking assets could reach
US$1.8 trillion by the end of 2016 – approximately 90%
higher than the US$939 billion recorded in 2010
(1)
.
Being Shari’ah compliant, Sabana Shari’ah Compliant
REIT is therefore able to tap into relatively more diverse
sources of equity funding and a larger investor base.
The Shari’ah Adviser
Sabana Shari’ah Compliant REIT has engaged Five
Pillars Pte. Ltd. (“Five Pillars”), a Singapore-based
Islamic finance advisory firm that specialises in Shari’ah
advisory, training and structuring products that are
Shari’ah compliant, to act as the Shari’ah Adviser. Five
Pillars has been providing Islamic finance consultancy
services since its incorporation in 2008.
The Shari’ah Adviser serves as a conduit between the
independent Shari’ah Committee and the compliance
officer, and will provide advice on, amongst others, the
implementation of the Shari’ah guidelines. The Shari’ah
Adviser will, on behalf of the Independent Shari’ah
Committee, collect, collate and relay all necessary and
relevant data from the Manager to the Independent
Shari’ah Committee. Representatives from the Shari’ah
Adviser may also inspect and verify the properties and
activities of Sabana Shari’ah Compliant REIT on behalf
of the Independent Shari’ah Committee.
The Independent Shari’ah Committee
The Independent Shari’ah Committee is an external
committee comprising independent Shari’ah scholars
selected by the Manager based on the advice of the
Shari’ah Adviser.
Sabana Shari’ah Compliant REIT is pleased to have the
services of some of the best Shari’ah and conventional
finance experts and scholars that it draws its Shari’ah
endorsement from. They are:
• Dr. Mohamed Ali Elgari;
• Professor Dr. Obiyathulla Ismath Bacha; and
• Dr. Ashraf bin Mohammed Hashim.
Source:
(1) Deutsche Bank Global Markets Research, Global Research, November 2011, “Global Islamic Banking – No longer unconventional”
SHARI’AH COMPLIANCE OF SABANA SHARI’AH COMPLIANT REIT
Shari’ah Compliance
ANNUAL REPORT 2011
47
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