According to Saif al-Samshi, the assistant governor for monetary policy and financial stability is that the "Despite the advanced state of the UAE in issuing Islamic sukuk, we believe that we still need to do more [including] finding a unified body for the main fatwas (decrees) in the Islamic financial services domain, as is the case in Malaysia".
Anyone who reads my blog with regularity over the past several years, will probably remember times where I have expressed support for national Shari'ah boards, and other times when I have questioned whether the establishment of national boards would limit the potential of the industry to innovate beyond the current state of replicating conventional products. So, to start the discussion, I will admit to not holding a consistent view on the issue because there are many different factors that would lead a national Shari'ah board to be successful or unsuccessful in providing consistency in Shari'ah rulings, with enough leeway for institutions to develop new products.
However, the question remains about whether developing a national Shari'ah board for the UAE to complement those that exist in Indonesia and Malaysia, with potentially more national Shari'ah boards popping up across the GCC, South Asia and Africa. On the once hand, national Shari'ah boards could provide clearer guidance on what the base Shari'ah standards are for individual countries, which would provide some certainty to institutions considering whether to launch cross-border services or products. But it would also risk crystallizing the status quo, and dividing the industry and limiting the ability of successful products to be adopted more widely, because they would likely have to be reviewed by the national Shari'ah board of every country, something which is unlikely to be as rapid as it could be if the Shari'ah-compliance decision were left to each institution (and its customers).
A recent article on the difficulties of introducing more arbitration proceedings in the place of court hearings to adjudicate disagreements in Islamic finance contracts leans to some regard in favor of greater centralization of Shari'ah standards. One difficulty, which the article convincingly argues could limit the use of arbitrations in Islamic finance, is that the Shari'ah standards applicable in the Islamic finance industry are determined more by individual Shari'ah boards, and not based on an industry-wide, or even country-wide set of standards. From this perspective, the establishment of national Shari'ah board could set the ground rules (on Shari'ah issues) for an arbitration panel and in cross-border deals, the contracts could specify then a certain national set of Shari'ah rules in case of disputes.
Perhaps a more specific plan for a national Shari'ah board in the UAE would give me more conviction on whether it would likely be a positive or negative development for the Islamic finance institution, because today I remain as conflicted as I was before on the issue.