This document discusses the challenges in making sukuk (Islamic financial certificates) fully shariah compliant. It outlines the definitions of key terms like sukuk and financial instruments. It then explains that most sukuk structures are based on leased real assets, as negotiability in shariah is only granted to those willing to own real assets. However, it notes that not all leases are equal - there are differences between financial and operating leases that must be considered. The document argues that stipulating that the lessee must repurchase the leased asset at the original price transforms the funds into a loan, which has serious shariah and economic consequences. It concludes that more work needs to be done to ensure