The French government has started work to put into place a legal
framework for Sharia-compliant financing.

Following a policy committee meeting last December, Minister of
Finance Christine Lagarde announced that the government is looking
closely at the sukuk (bond market), murabaha (purchase and resale
market) and ijara (leasing market) principles of Islamic
finance.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

“We are open to the establishment of Islamic banks in France,”
said Lagarde. “These changes will offer judicial and fiscal
measures to investors wishing to conform to Islamic
principles.”

However, one of the main sticking points of introducing Islamic
finance into France is the prohibition of riba, or usury. Under
current legislation, French businesses may be given tax relief on
the interest they pay, for example in international transactions.
Lagarde has instructed her ministry to look into finding a solution
by year-end.

Islamic finance particularly appeals to the French government as
it would like to attract foreign investors from the Gulf
states.

Christian Noyer, the governor of the Banque de France, completed
a tour of the Gulf states in January, where he led a mission of
representatives to convince investors to inject much-needed cash
into the French economy.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

In anticipation of the legislative changes, international law
firms such as Norton Rose are taking steps to develop their Islamic
finance practices in Paris.

Norton Rose recently advised BNP Paribas and Natixis Transport
Finance in a Sharia-compliant transaction to purchase eight Airbus
planes for Air Asia. Business is likely to increase when the new
framework comes into action later this year.