A Comprehensive Range of Services
We advise on the full spectrum of modern and traditional Islamic finance contracts, including Sukuk, Wa'ad, Murabaha, Ijara, Mudaraba and Musharakah.
Our expertise extends to the establishment of new Islamic financial institutions, product strategy development, legal risk management, as well as banking and finance transactions, project finance, asset finance, trade finance, derivatives, fund structuring and insurance transactions.
What Is the Tax Regime for Islamic Finance Transactions in France?
France has put in place a dedicated tax framework designed to ensure the tax neutrality of the main Islamic finance instruments. This framework, published in the official Bulletin officiel des finances publiques under the reference BOI-DJC-FIN, sets out the applicable regime for corporate income tax, withholding tax on payments to non-residents, local business tax, VAT, and registration duties, for four categories of transactions:
- Murabaha (BOI-DJC-FIN-10): a sale transaction with a disclosed profit margin
- Investment Sukuk (BOI-DJC-FIN-20): securities structured as debt instruments for tax purposes
- Ijara (BOI-DJC-FIN-30): Sharia-compliant leasing transactions
- Istisna'a (BOI-DJC-FIN-40): financing for the construction or manufacture of an asset
The guiding principle of this regime is to treat these instruments, for tax purposes, as ordinary debt instruments, despite their legal structuring as sale, lease, or profit-sharing transactions — avoiding double taxation or a penalising tax treatment that would discourage their use in France. Correctly applying this regime, condition by condition, is decisive for the tax security of any transaction structured according to Sharia principles on French territory. Whitefield supports financial institutions and investors in the legal structuring and tax security of these transactions.
In-Depth Understanding of Shariah Principles
With a rigorous and nuanced understanding of Shariah principles, combined with close working relationships with leading internationally recognized Shariah scholars, our team offers acknowledged expertise in the structuring of complex Islamic financial products and the management of sophisticated transactions.
Committed to the Growth of the Industry
Members of our team actively contribute to the development of the Islamic finance industry. They have participated in the work of the Islamic Finance Technical Group of HM Treasury, the UKTI Islamic Finance Sub-Committee, and the HM Treasury Islamic Finance Experts Group.
We are also a strategic partner in an international initiative dedicated to the training and development of the next generation of Shariah scholars specializing in Islamic finance.
Why Choose Whitefield for Your Islamic Finance Transactions?
Our firm provides in-depth expertise in Islamic finance, fully compliant with Shariah principles, and advises clients both on structuring and strategic matters as well as in dispute resolution.