KARACHI, Feb 20 (APP): Pakistan Stock Exchange (PSX), on Friday, invited stakeholders’ feedback on the proposed Shariah Trading Regulations- an initiative aimed at introducing a dedicated platform for fully Shariah-compliant trading to further strengthen country’s Islamic capital market landscape.
PSX, in compliance with the constitutional requirement, Federal Shariat Court’s judgement, and directives of the regulator pertaining to elimination of riba from Pakistan’s financial system, has proposed a segregated Shariah compliant trading counter within the existing PSX market; a notice inviting public comments stated.
The segregation, according to PSX, could be achieved through distinguishing the Shariah-compliant brokerage business from the conventional one, account-level designation, broker-level controls and system-level validations, without dividing or altering the core trading engine.
The Constitution of Pakistan requires the State to completely eliminate ‘Riba’, whereas the Federal Shariat Court’s judgement dated April 28, 2022 provided a five-year timeline for eradication of riba from the country’s financial system.
Moreover, the SECP via Strategic Action Plan for the Development of Islamic Finance in the Non-Bank Financial Sector mandated the exchange to introduce after consensus of stakeholders a mechanism for trading in Shariah compliant manner.
The PSX has drafted the amendments as per the internal assessment of Capital Market Infrastructure Institutions, recommendations of the Shariah Focus Group of PSX, comprising of renowned Shariah scholars and practitioners, discussions with the Pakistan Stock Broker Association, concurrence with the SECP and in light of practices of other stock exchanges that cater to the Shariah investors.
PSX also proposed to introduce a new dedicated Chapter in PSX Regulations on “Shariah-Compliant Securities Trading”, prescribing key requirements pertaining to eligibility criteria for Shariah-compliant securities broker, pre-trade validations, compliance with the Shariah Governance Regulations and Guidelines.
The PSX encouraged all market participants, investors, stakeholders and others concerned to review the proposed amendments to PSX regulations in relation to Shariah compliant securities trading; and contribute their input in the prescribed manner by March 02, 2026.