A working group has been formed to develop a regulatory framework for Islamic banking and finance in the Philippines after President Rodrigo Duterte signed the Islamic banking act into law on August 22.
The agency comprises officials from Bangko Sentral ng Pilipinas (BSP), Asian Development Bank, Bureau of the Treasury, Department of Finance, Securities and Exchange Commission, Philippine Deposit Insurance Corporation, Insurance Commission, Bureau of Internal Revenue, Financial Reporting Standards Council, and National Commission on Muslim Filipinos.
The internal revenue office has already completed its draft regulation to implement the provision on tax neutrality under the law, said the central bank in a statement on Friday.
The act signed by the president mandates Bangko Sentral ng Pilipinas to exercise regulatory powers and supervision over the operations of Islamic banks and to issue the rules and regulations on Islamic banking, said the central bank.
Last month, the central bank told local media it would “fast-track” the issuance of regulations and rules for Islamic banking and finance as soon as the act becomes law.
Philippines has been accelerating the growth of its Islamic economy sectors in the last couple of years.
The Southeast Asian country’s interest in Islamic finance is primarily two-fold: to attract Shariah-sensitive foreign investments and capital from Islamic countries, as well as to provide its approximately 10 million domestic Muslim population with an Islamic banking option.
The country also hopes to increase its exports to Muslim-majority countries and has been developing its halal infrastructure to support this goal.
San Miguel, a major food manufacturer in the country, received halal certification for two of its facilities earlier this month and is now eyeing exports to the Gulf Arab states.
Philippines' national halal certification scheme was launched last year by the Philippine Halal Export Development and Promotion Board, and in February the Department of Science and Technology opened the Philippine National Halal Laboratory and Science Centre.
The country launched its new national halal logo in July.
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