This article presents a well-written and informative analysis on the Shariah Governance Framework in the banking sector of Saudi Arabia. The study utilizes both primary and secondary resources, covering the significance of shariah governance in the Islamic banking industry, specifically the conflict of interest that may arise from related party transactions involving shariah committee members. While the article provides useful insights into the regulatory framework governing corporate governance in the Islamic banking industry, there are areas where it could benefit from further critical analysis. For instance, the article would benefit from examining the effectiveness of the current regulations in achieving their intended goals, particularly in increasing investor trust and minimizing potential risks. Furthermore, the article could explore the challenges and limitations in implementing these regulations in the Islamic banking sector, particularly in mitigating and managing potential conflicts of interest among shariah committee members. The article provides a comprehensive overview of the Shariah Supervisory Board framework in Saudi Arabia, particularly in terms of its composition, independence, and related party transactions. However, it highlights areas where further clarification may be needed, such as the issue of multiple memberships of SSB and board of directors and the lack of cap on the remuneration of SSB members. The article suggests that these areas should be addressed to ensure transparency and good corporate governance in the banking industry. Overall, this paper contributes significantly to the existing literature on corporate governance in the Islamic banking industry and generates valuable insights into the regulatory framework and its impact on related party transactions involving shariah committee members.
Summary: 1. Introduction. – 2. Modern investment legal frameworks. – 2.1. The ideal legal frameworks for attracting foreign direct investment. – 2.2. Whether the effectiveness of the legal frameworks should be a determent factor in Foreign Direct Investment. – 3. An overview of KSA legal framework governing foreign investments. – 3.1. Policy objectives of KSA. – 3. 2. Legislative landscape. – 4. Preliminary matters. – 4.1 Investment law. – 4.2 Entry mechanism and Screening procedures. – 4.3. The GATS framework. – 4.4 Foreign Direct Investment Impact. – 4.5 Special Economic Cities. – 5. Conclusion.