The requirements are as follows:

(i) Shariah Discretionary Account (“Shariah DA”)

The Islamic PO should separate the Shariah DA from a new or existing trading account and should additionally ensure that the Shariah DA of its clients within the Islamic window services is clearly tagged and used as a Shariah DA for the purpose of Islamic window services only.

(ii) Fee-based and Profit-Sharing Model and Structure

As stated in item 3, section F of Best Practice No. 7.16-001 (Best Practices in the Islamic Stockbroking Services Undertaken by Participating Organisations), an Islamic PO may offer Shariah DT based on the following models and structures:

• Wakalah
  
  Under the Wakalah principle, an Islamic PO may impose a Wakalah fee on its client. The Wakalah fee may be mutually agreed to by the Islamic PO and its client as a fixed amount or as a percentage of the value of assets or portfolio under management.
  
  Illustration:
  
  
  
• Mudarabah
  
  Under the Mudarabah principle, the Islamic PO may have an arrangement with the client to accept a share in the profits from the client’s DA. The profit should not be fixed in the form of a certain percentage of the capital.
  
  Illustration:
  
  
  
• Musharakah
  
  Under the Musharakah model, the Islamic PO and its client(s) enter into a contractual partnership agreement, whereby both parties invest a sum of money as capital and share its profit according to the agreement.
  
  The parties in a Musharakah contract may agree to appoint only one (1) party to act as the managing party, which in this case will be the Islamic PO. The managing party may be entitled to an agreed remuneration on top of his share in profit as a party in the Musharakah contract.
  
  Illustration:
  
  
  
  (Refer to: Best Practices for Islamic Stockbroking Services)