For the purposes of this standard, the following words and phrases shall have the meanings stated below.

1. Senior Management: The executive management of the Bank responsible and accountable to the Board for the sound and prudent day-to-day management of the Bank or IFI, generally including, but not limited to, the chief executive officer, chief financial officer, chief risk officer, and heads of the compliance and internal audit functions. The term Senior Management includes the head of Islamic banking at the licensed financial Institutions that conduct part of their activities and businesses in accordance with the provisions of Islamic Shari'ah.
    
2. Independence: Ensuring that the Internal Shari'ah Supervision Committee is not subject to any form of undue influence when issuing resolutions and fatwas in accordance with the Shari'ah parameters, and ensuring that the Internal Shari'ah Control Division or Section and Shari'ah Audit Division or Section are also not subject to any form of undue influence. This should be carried out to strengthen the confidence of both shareholders and stakeholders in the IFIs compliance with Islamic Shari'ah.
    
3. External Shari'ah Audit: An annual assessment conducted by external body to inspect and assess the IFI's compliance with Islamic Shari'ah and the level of adequacy and effectiveness of the governance of Shari'ah supervision systems.
    
4. Internal Shari'ah Audit: regular process to inspect and assess the IFI's compliance with Islamic Shari'ah and the level of adequacy and effectiveness of IFI's Shari'ah governance systems.
    
5. Compliance with Islamic Shari'ah refers to compliance with Shari'ah in accordance with :
   a. resolutions, fatwas, regulations, and standards issued by the Higher Shari'ah Authority in relation to licensed activities and businesses of IFIs ("HSA's Resolutions"), and
   b. resolutions and fatwas issued by ISSC ("ISSC") of the respective IFI, in relation to licensed activities and businesses of such institution ("the Committee's Resolutions"), provided they do not contradict HSA's Resolutions.
    
6. Shari'ah Supervision: monitoring of IFI's compliance with Islamic Shari'ah in all its objectives, activities, operations, and code of conduct.
    
7. Subsidiary: An entity, owned by another entity by more than 50% of its capital, or under full control of that entity regarding the appointment of the Board of directors.
    
8. Affiliate: An entity owned by another entity by more than 25% and less than 50% of its capital.
    
9. Fatwas: juristic opinions on any matter pertaining to Shari'ah issues in Islamic finance, issued by HSA or ISSC.
    
10. Internal Shari'ah Supervision Division (or Section): a technical division (or section) in the IFI with a mandate to support the ISSC in its duties.
     
11. Internal Shari'ah Supervisory Committee ("ISSC"): a body appointed by the IFI, comprised of scholars specialized in Islamic financial transactions, which independently supervises transactions, activities, and products of the IFI and ensures they are compliant with Islamic Shari'ah in all its objectives, activities, operations, and code of conduct.
     
12. Board: IFI's board of directors
     
13. Group: A group of entities which includes an entity (the 'first entity') and:
    a. any Controlling Shareholder of the first entity;
    b. any Subsidiary of the first entity or of any Controlling Shareholder of the first entity; and
    c. any Affiliate, joint venture, sister company and other member of the Group.
     
14. Shari'ah Non-Compliance Risks: probability of financial loss or reputational damage that IFI might incur or suffer due to not complying with Islamic Shari'ah.
     
15. Confidential Information: information that is publicly unavailable and its disclosure is not allowed.
     
16. Code of Conduct: refers to the principles that are intended to govern the activities of IFI with regard to (a) protection of their customers' interest, and (b) market integrity (c) and internal work environment.
     
17. Islamic Financial Institutions (Institutions/IFIs): The CBUAE licensed financial Institutions that conduct all or part of their activities and businesses in accordance with the provisions of Islamic Shari'ah.
     
18. Higher Shari'ah Authority (HSA): is the Central Bank's Higher Shari'ah Authority for financial and banking activities.