The application of UK prospectus rules to sukuk (Islamic securities) on the London Stock Exchange

Islamic investment certificates have raised over USD 51 b on the London Stock Exchange. Listing on an authorised exchange (LSE or other) is required for sukuk to receive regulatory and tax treatment without which they could not compete economically with conventional bonds. Like all securities marketed to the public sukuk are subject to the Listing and Prospectus Rules under the Financial Services and Markets Act 2000 and secondary legislation. This article identifies the requirements under the Prospectus Rules as they apply to sukuk and highlights a distinctive issue that arises in the drafting and regulatory screening of a sukuk prospectus.