PERTANIKA JOURNAL OF TROPICAL AGRICULTURAL SCIENCE

Arbitration is one of the important alternative dispute resolution (ADR) methods. Being an alternative method, it has advantages over the conventional dispute resolution mechanisms i.e. court litigation. This paper examines the law governing arbitration as a method of resolving disputes in Islamic banking and finance in Malaysia. Main provisions of related statutes and rules are discussed, as well as related issues. This paper adopts library research method and analyses relevant statutory laws, decided cases, books, journals, law reports, newspaper articles, conference proceedings and other periodicals. This paper concludes that although the law related to arbitration in Islamic banking in Malaysia is already in place, improvements are needed to ensure the arbitral process is more in line with the Shariah principle.