Integrating Maqasid al-Shari'ah in Islamic Financial Lawmaking in Indonesia from Fatwa to Regulation

Abstract

This article analyzes the transformation of Islamic legal norms from fatwa into binding state regulation in Indonesia's Islamic financial sector, focusing on the substantive integration of Maqasid al-Shari'ah in the lawmaking process. Although Indonesia has developed an extensive fatwa-based regulatory framework issued by the National Sharia Council (DSN-MUI), it remains unclear whether these regulations advance maqasid objectives beyond formal sharia compliance. Using a normative-juridical and doctrinal approach, this study examines fatwas, statutes, and regulatory instruments to assess the articulation and operationalization of maqasid in regulatory design. The findings reveal that Islamic financial regulation is predominantly compliance-oriented, emphasizing contractual legality and prudential supervision over broader aims such as social justice, financial inclusion, and equitable risk-sharing. To address this limitation, the article proposes a three-layered maqasid integration model—normative, institutional, and operational—to enhance regulatory coherence, legal certainty, and substantive justice. This study demonstrates that maqasid al-Shari'ah does not automatically materialize through fatwa-based regulation and must be deliberately institutionalized within legislative reasoning, regulatory drafting, and post-implementation evaluation.