Islamic Finance in Luxembourg

Islamic Finance in Luxembourg

For several years, Luxembourg has been evolving as a global hub for Islamic Finance. The Government has been instrumental in putting the measures and means in place to allow the development of Islamic Finance. It has been the first European stock market to launch and list sukuk, it has been the first European Member State to be admitted to the Council of the Islamic Financial Services Board, and has organised frequent government sponsored missions to GCC countries, underlining its commitment to making Luxembourg a primary hub for the development of Islamic Finance.

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  • Why Luxembourg?

    Why Luxembourg?

    Luxembourg is strategically located at the heart of Europe with a very stable economy and as a result is suffering less in comparison to other governments with regard to public deficit management. It is anticipated that no important tax reform will take place within the next years.

    In addition, Luxembourg is very well positioned to attract Islamic finance projects thanks to its highly qualified multicultural professionals, its favorable and flexible legal and regulatory environment (investment vehicles compatible with Islamic finance, securitisation law) and its state of the art investment fund industry (Luxembourg is the second fund domicile globally after the US).

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  • What is Islamic Finance?

    Islamic Finance

    Islamic Finance is subject to Shari'a principles. The Shari"a can be translated as "the path to the source of water" and is very often referred to as the Islamic law. Unlike Civil law or Common law, Islamic law regulates not only the relationship of man with man but also man with Allah.

    People often see Islamic Finance as being simply an interest free financial system, which is not entirely accurate as it also involves other important principles, which encourage entrepreneurship, risk-taking, transparency, preservation of property rights and ethical values such as justice, fair dealing and fair pricing, mutual cooperation and respect of the other contracting parties.

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