Fatwa
A juristic opinion on a Shariah question; in finance, usually a Shariah board's ruling on a product or transaction.
A fatwa is a juristic opinion on a matter of Shariah. In the definition used in IFSB-21 and IFSB-26, it is an opinion given by the Shariah board on any matter pertinent to Shariah issues, based on the appropriate methodology. In finance a fatwa or resolution typically approves a product structure subject to conditions, and whether it binds anyone beyond the institution depends on the issuing body and the jurisdiction.
Sources
This entry explains a term; it is not a Shariah ruling. Approving a product is for each institution's own Shariah board and regulator.
Related terms
Shariah supervisory boardAn independent panel of Shariah scholars that approves an institution's products and oversees its Shariah compliance.Central Shariah boardA national or regulator-level Shariah authority whose rulings set or harmonise Shariah positions across a jurisdiction.ShariahIslamic law and its principles; in finance, the rules that contracts, products and institutions are expected to comply with.