Shariah Economics in Indonesia

H. Andi Syamsu Alam

(Deputy  Chief  Justice  for  Religious  Court Affairs)

Preface

If it is questioned, why in Indonesia used the terminology Shariah Economics, and not Islamic Economics? one of the possible answer is to eliminate the perception that the system was applied to the moslem only, but everyone can aplly the shariah principles of economics, remains called by shariah economics.

According to Dr. Hari, a member of parliament in Jakarta, there is a shariah bank whose customers are two third of them are chinese and non-moslems. In Indonesia, almost all the existing banks, either State or private banks, establish a bank with Shariah system or Shariah business unit.

Principles of Shariah Economics

According to the book of Law of Shariah Economics, written by Prof. Dr. H. Zainuddin Ali, MA., the principles of Shariah Economics are as follows:

1.         Readiness to bear risk (al-kharaj  bi  al-dhaman).
2.         No hoarding.
3.         No monopoly.
4.         The prohibition of usury interest.

The Types of Shariah Economics Institutions in Indonesia

According to the explanation of Article 49 of Law Number 3 of 2006 on the Amendment of Law Number 7 of 1989 on Religious Judicature, that Shariah economics are the deed or business activities conducted under the principles of Shariah economics, includes:

1.         Shariah Banking
2.         Shariah Microfinance Institutions
3.         Shariah Insurance
4.         Shariah Reinsurance
5.         Shariah Mutual Funds
6.         Shariah Bonds and Shariah Medium-Terms Securities
7.         Shariah Securities
8.         Shariah Finance
9.         Shariah Pawnshop
10.     Shariah Pension Fund
11.     Shariah Business

Dispute of Shariah Economics

Based on the Article 49 of Law Number 3 of 2006 on the Amendment of Law Number 7 of 1989 on Religious Judicature, the authorized institution to settle the dispute of shariah economic is Religious Courts. Similarly, the provision of Article 55 of Law Number 21 of 2008 on Shariah Banking, that the institution authorized to settle the Shariah banking disputes is Religious Courts. But based on the explanation of Article 55 Law Number 21 of 2008 on Shariah Banking, the disputes are also can be settled by General Courts.

 Thus, especially for the dispute of Shariah banking, the actors of shariah bankings may choose to bring the disputes to either Religious Courts or General Court. The right to choose such forum is called by the right of option.

Provisions of Regulation of Shariah Economics

The provisions prevailed to run the shariah economics in Indonesia are based on the fatwa of National Shariah Board (DSN in Bahasa). Specially for shariah banking, the fatwa of National Shariah Board have been much adopted to be Regulations of Bank of Indonesia (PBI in Bahasa).

Shariah economics are growing very rapidly in Indonesia, especially in the Shariah Banking field. Business activities in the form of Shariah businesses have been emerging everywhere, like Shariah hotels, Shariah swimming pools, Shariah repair shops, shariah karaoke, and in the latest discussion of Shariah Economics held in Tarakan in 2010, some participants suggested to establish a shariah supermarket.

The Readiness of Religious Courts

In  2009,  because  of  no  substance  law  that  referred  to  by  the  judges  of Religious   Court,   it   has   been   enacted   the   Regulation   of   Supreme   Court Number 2 of 2008 on Compilation of Laws of Shariah Economics. According to the schedule, in 2011 will be enacted a Regulation of Supreme Court on Compilation of Procedural Laws of Shariah Economics. The committee have been working officiated by Justice Prof. Dr. H. Abdul Manan, SH., S.IP., M. Hum.

To explore the Shariah Economics system applied in Indonesia, the judges of Religious Courts has begun to be trained or educated gradually. Some judges of Religious Court have been delegated to undertake a comparative study to Malaysia, Pakistan, England, Sudan, and Saudi Arabia.

In 2010, we gained a relief from Saudi Arabia to study at King Abdul Aziz University for one month for 40 (fourty) judges of Religious Court whose Arabic proficiency. In 2011, it has been planned to delegate 40 judges more.

In the previous 2010, based on the cooperation between Directorate General of Religious Court Body and the Government of Sudan, there have been delegated 7 (seven) elected judges to study for 2 (two) weeks in Sudan. According to the planning of Directorate General of Religious Court Body, a team of Indonesia Supreme Court will be delegated to Sudan to sign Memorandum of Understanding (MoU) for a training cooperation for judges of Shariah Economics.

Since 2008, some judges of Religious Court have graduated Ph.D in the field of Shariah Economics from various university in Indonesia.

And at the Deputy of Religious Court Affairs, we are thinking about the possibility to apply the certification system for the jugdes of Religious Court who will examine and settle the dispute of Shariah Economics.

Closing

The number of Judges of Religious Court in Indonesia, according to data obtained from the Directorate General of Religious Court Body are about 3.015 judges. They spread all over Indonesia, at 343 Religious Court, 29 High Religious Court and culminating to the Supreme Court in Jakarta. Settlement of cassation and the request of civil cases (PK in Bahasa) is in the Team E with 6 (six) Supreme Justices. It is proposed that this year we will have 1 (one) new female Supreme Justice and 1 (one) male Supreme Justice, and thereby, Team E will be 8 (eight) Supreme Justices.

There are about 34 % (thirty four percents) Female Judges of all judges of Religious Court throughout Indonesia. And during the year 2010, Religious Court has settled 377.230 (three hundred and seventy seven thousands two hundred and thirty) cases, in 2011 it is estimated to increase more until 400.000 (four hundred thousand cases), because we now have legal aid post (Posbakum), cost-free cases and circuit court programs. Most cases are family disputes followed by jinayah (criminal) cases in Aceh, the child adoption and Islamic economics.

 Source: http://www.badilag.net/english