ABSTRACT
This chapter discusses the prohibition against riba and gharar under Shari'a and its impact on arbitration agreements and arbitrability. The central question of this chapter is how the prohibition against riba and gharar impacts on arbitrability and arbitration agreements when parties choose governing law or arbitration rules based on Shari'a, or a national law influenced by Shari'a principles. The chapter discusses three main principles operating under Shari'a, and their impact on arbitrability: (1) the prohibition against gharar; (2) the prohibition against riba; and (3) the sanctity of contracts under Shari'a, which means that contracts should be fair and based on mutual consent of the parties. Domestic arbitration laws define matters that may be arbitrable in accordance with the public policy of the State. If arbitration proceedings are subject to classical Shari'a and the subject matter contains riba and/or gharar, then the matter is non-arbitrable and renders the arbitration agreement void.
