FAQ in the category of Trade

1 Is share market permissible in Islam?

Is share market business allowed in Islam?

Today, in this sense, we need to analyze the selling and purchasing the stock certificate which is the base of the stock exchange.

1- To be a shareholder of a company which is working on business licit to be produced and put into market. This is without any doubt is allowable. The buyer becomes a partner of that company in accordance with the percentage of his shares, and takes part in its profit and loss, and he is entitled to sell his shares whenever he wishes.  (The number of such companies is quite much.)

2- Buying and selling a share that  gains or losses price in a way free from the economical value it belongs in the intend of  appreciating  the present money or keeping its charge or making money by seeking profit. The dealings in the stock market are in the second form. Investing on the exchange market in this sense, though not completely, it is similar to playing gamble or lottery.

It causes the shares to be more precious or cheaper than they are. The people earn or loss money without any sound contribution to the economy and production of the country. In this regard, it is very difficult to assess the exchange stock to be, at every point, as an acceptable trade. (Hayrattin Karaman, Gunluk Hayatimizda Halallar ve Haramlar, p. 265, Istanbul 1999)
In the final declaration of the Stock Market Symposium held in Rabat in 1988 with the attempt of Islamic Law Academy adherent to Islamic Conference Organization and in the seventh term meeting of the academy which was conducted in Jeddah in 1992, it was stated that the shares are licit in that they take part in both profit and loss and yet the Islamic decree about this subject is highly related with the condition that the trade dealings and utmost purpose of the company in question must be permissible. 

At this point it must be stressed out that in the cases that the profit of the company might be mixed with illicit, not because of that the activity area of the company is doing prohibited dealings, producing the commodities against the Islamic law, but because of that the company may have been in favour of unlawful proceedings, the shareholders are recommended to count this amount roughly and spend it in the way of good assuming that it is, after all, the right of the public but he should not seek any intention of good deeds for himself.

Indeed majority of the scholars of Islam arrived at a consensus, though some contemporary scholars claim otherwise, the stock market and shares two important Islamic problems of today are permissible in Islam. However, the company whose shares we want to purchase should not have any hand in producing alcohol or pork meat which is forbidden in Islam.

Whether it is permitted buying and selling shares from Stock Exchange, we can determine it by analyzing the following conditions.

1- It is banned to purchase the shares of the companies obviously conducting interest proceedings such as banks, bankers, usuary institutions.

2-It is the same decree for the companies working on the production, selling and buying of the Islamic-banned-things like vine, beer and so forth.

3- Also, it is vetoed in Islam to buy shares from the companies that are selling at interest the goods of which we have share, and then mixing that profit with the other goods.

4-Though the commodity the share of which we have is allowable, if the Muslim people who are the owner of the company whose shares we have are engaged in disallowed dealings, we are proscribed to get any share from that company. Because if we buy anything from them, then we would support them indirectly which is called “cooperation in sin” in Quran. And that cooperation is not permitted in our holy book.

5- Buying any share from the Christian or Jewish-owned companies is abominable even if there may not be any other drawback. When the Islamic law books observed, it can be come into such a conclusion that it is not allowed to buy any share from communist, mason or atheist dominated companies. 

6- It must be known about what is the percentage of the bought share compared to the whole company.

7-There must be asset. Buying the shares of an institution like Credit Company is prohibited in Islam.

8- It is permissible to buy participation shares from the share owner of a company which is essentially licit but is not being run in accordance with Islamic rules so that you can receive what he owes you. But you must sell those share certificates as soon as possible. And if you make any profit out of that trading; you must give it either to the poor or to the service of public.

9- It is unanimously licit to buy from the companies that have no relation with what is impermissible, the Muslim people constitute the majority, declare obviously the share to the sold stock certificate of the company which is subject to be sold, enable the people whenever they intend to give up the partnership.  And these Muslim Businessmen are extremely important for Islamic enterprises and licit capital. Because participation shares are the most crucial alternative for the interest which is one of the greatest major sins in Islam, the sharpest way of finding management and investment capital. If the Muslim people succeed putting this into practice by keeping it far from interest, they can be a means for coming about great operational managements and eradicating the interest.

Sources:
Halil Gönenç, Günümüz Meselelerine Fetvalar, 1. Cilt, s. 382-383.
Dr. Faruk Beşer, Fetvalar, Nil Yayınları, İzmir, 1991, s. 78-79.

2 Is private life insurance permissible?

There are many aspects of the insurance. It is impossible to mention all of them here. Insurance is divided into three groups, these are; compulsory or social insurance, private business insurance and solidarity insurance (mutual insurance, indemnity insurance). Since the third one is completely an organization of help and solidarity, it is permissible and nearly everybody is unanimous in this. Having the purpose of providing help and solidarity among the citizens in order to share the risks of life between each other, the first one too, is actually same with the third one. The only difference between them is that the first one is compulsory. 

The insurance, which is argued about, is the second, which is private business insurance. Actually, having no difference in terms of operation, such insurances have two unfavorable aspects. The first is; because of the amount of money that the insurance companies are suppose to tie up in a bank, generally they are subsidiary companies of a bank and they get interest from the collected amount of money. And the second is charging interest to the some kinds of life insurances. Apart from that, the difference between these type of insurances and social insurances is only that social insurances are organized by government but these are organized by private sectors. And this doesn’t change the judgment. The first unfavorable case of these two doesn’t break the contract, since it is out of the terms of the contract. It is something like that for example a grocer –that you trade with- makes use of money in an ill-gotten way. Such a contract isn’t forbidden but since it indirectly sustains undeserved earnings, it is not unobjectionable. Allah Almighty decrees; “Help each other by fairness and piety (taqwa), but not by enmity and sin”. Therefore, if there are insurance companies which don’t include such kind of objections, we should work together with them, but if there aren’t, it can not be permissible.    
But the second objection is directly interest and such a contract is completely forbidden itself. The insured person pays the premium for a length of time and pays it back with its real interest rate later. Certainly this is usury. 

In conclusion, if there is an opportunity that removes such objections, then claiming that it is forbidden will have no grounds (Faruk Başer).

3 Is share market business and life insurance allowed in Islam?

Is private life insurance permissible?

There are many aspects of the insurance. It is impossible to mention all of them here. Insurance is divided into three groups, these are; compulsory or social insurance, private business insurance and solidarity insurance (mutual insurance, indemnity insurance). Since the third one is completely an organization of help and solidarity, it is permissible and nearly everybody is unanimous in this. Having the purpose of providing help and solidarity among the citizens in order to share the risks of life between each other, the first one too, is actually same with the third one. The only difference between them is that the first one is compulsory. 

The insurance, which is argued about, is the second, which is private business insurance. Actually, having no difference in terms of operation, such insurances have two unfavorable aspects. The first is; because of the amount of money that the insurance companies are suppose to tie up in a bank, generally they are subsidiary companies of a bank and they get interest from the collected amount of money. And the second is charging interest to the some kinds of life insurances. Apart from that, the difference between these type of insurances and social insurances is only that social insurances are organized by government but these are organized by private sectors. And this doesn’t change the judgment. The first unfavorable case of these two doesn’t break the contract, since it is out of the terms of the contract. It is something like that for example a grocer –that you trade with- makes use of money in an ill-gotten way. Such a contract isn’t forbidden but since it indirectly sustains undeserved earnings, it is not unobjectionable. Allah Almighty decrees; “Help each other by fairness and piety (taqwa), but not by enmity and sin”. Therefore, if there are insurance companies which don’t include such kind of objections, we should work together with them, but if there aren’t, it can not be permissible.    
But the second objection is directly interest and such a contract is completely forbidden itself. The insured person pays the premium for a length of time and pays it back with its real interest rate later. Certainly this is usury. 

In conclusion, if there is an opportunity that removes such objections, then claiming that it is forbidden will have no grounds.  

Faruk Başer

Is share market business allowed in Islam?

Today, in this sense, we need to analyze the selling and purchasing the stock certificate which is the base of the stock exchange.

1- To be a shareholder of a company which is working on business licit to be produced and put into market. This is without any doubt is allowable. The buyer becomes a partner of that company in accordance with the percentage of his shares, and takes part in its profit and loss, and he is entitled to sell his shares whenever he wishes.  (The number of such companies is quite much.)

2- Buying and selling a share that  gains or losses price in a way free from the economical value it belongs in the intend of  appreciating  the present money or keeping its charge or making money by seeking profit. The dealings in the stock market are in the second form. Investing on the exchange market in this sense, though not completely, it is similar to playing gamble or lottery.

It causes the shares to be more precious or cheaper than they are. The people earn or loss money without any sound contribution to the economy and production of the country. In this regard, it is very difficult to assess the exchange stock to be, at every point, as an acceptable trade. (Hayrattin Karaman, Gunluk Hayatimizda Halallar ve Haramlar, p. 265, Istanbul 1999)
In the final declaration of the Stock Market Symposium held in Rabat in 1988 with the attempt of Islamic Law Academy adherent to Islamic Conference Organization and in the seventh term meeting of the academy which was conducted in Jeddah in 1992, it was stated that the shares are licit in that they take part in both profit and loss and yet the Islamic decree about this subject is highly related with the condition that the trade dealings and utmost purpose of the company in question must be permissible. 

At this point it must be stressed out that in the cases that the profit of the company might be mixed with illicit, not because of that the activity area of the company is doing prohibited dealings, producing the commodities against the Islamic law, but because of that the company may have been in favour of unlawful proceedings, the shareholders are recommended to count this amount roughly and spend it in the way of good assuming that it is, after all, the right of the public but he should not seek any intention of good deeds for himself.

Indeed majority of the scholars of Islam arrived at a consensus, though some contemporary scholars claim otherwise, the stock market and shares two important Islamic problems of today are permissible in Islam. However, the company whose shares we want to purchase should not have any hand in producing alcohol or pork meat which is forbidden in Islam.

Whether it is permitted buying and selling shares from Stock Exchange, we can determine it by analyzing the following conditions.

1- It is banned to purchase the shares of the companies obviously conducting interest proceedings such as banks, bankers, usuary institutions.
2-It is the same decree for the companies working on the production, selling and buying of the Islamic-banned-things like vine, beer and so forth.
3- Also, it is vetoed in Islam to buy shares from the companies that are selling at interest the goods of which we have share, and then mixing that profit with the other goods.
4-Though the commodity the share of which we have is allowable, if the Muslim people who are the owner of the company whose shares we have are engaged in disallowed dealings, we are proscribed to get any share from that company. Because if we buy anything from them, then we would support them indirectly which is called “cooperation in sin” in Quran. And that cooperation is not permitted in our holy book.
5- Buying any share from the Christian or Jewish-owned companies is abominable even if there may not be any other drawback. When the Islamic law books observed, it can be come into such a conclusion that it is not allowed to buy any share from communist, mason or atheist dominated companies. 
6- It must be known about what is the percentage of the bought share compared to the whole company.
7-There must be asset. Buying the shares of an institution like Credit Company is prohibited in Islam.
8- It is permissible to buy participation shares from the share owner of a company which is essentially licit but is not being run in accordance with Islamic rules so that you can receive what he owes you. But you must sell those share certificates as soon as possible. And if you make any profit out of that trading; you must give it either to the poor or to the service of public.

9- It is unanimously licit to buy from the companies that have no relation with what is impermissible, the Muslim people constitute the majority, declare obviously the share to the sold stock certificate of the company which is subject to be sold, enable the people whenever they intend to give up the partnership.  And these Muslim Businessmen are extremely important for Islamic enterprises and licit capital. Because participation shares are the most crucial alternative for the interest which is one of the greatest major sins in Islam, the sharpest way of finding management and investment capital. If the Muslim people succeed putting this into practice by keeping it far from interest, they can be a means for coming about great operational managements and eradicating the interest.

Sources:
Halil Gönenç, Günümüz Meselelerine Fetvalar, 1. Cilt, s. 382-383.
Dr. Faruk Beşer, Fetvalar, Nil Yayınları, İzmir, 1991, s. 78-79.

4 Which type of Riba is Al-riba?

Riba (interest) is an Islamic law term which has the meanings of increasing, multiplying, inflating, developing, attaining and during interchange agreements, a gratuitous excess, which is accepted as the right of one part (from two parts) and laid down as a condition during the agreement. The word “riba” being an infinitive in Arabic, etymologically, means “absolute increasing”.
When two things which are the same kind and amount are exchanged, the extra amount for one party is called “riba” or “interest” (Ibnul-Human, Fathul-Qadir, V, 227) such as exchanging 100 gr. gold for the same carat of 120 gr. gold in cash or forward... In such a procedure, one who gives 100 gr. gold has to take the same amount of gold. Here, if the 100 gr. gold is capital (ra’sul mal), and the 20 gr. is excess, that excess is called “riba” (Elmalılı, Hak Dini Kur’an Dili,II, 952,953).
In Turkish, instead of the word of “riba”, the word of “faiz” (interest) is used. That word has the meanings such as overflowing, overflow, full and the profit taken in return for the given money. Elmalılı Hamdi Yazır when explaining that “riba” and “faiz” have the same meanings; says the following: The word “riba”, in the dictionary, is translated as “increasing” and “inflating”, so it assumed the meaning of “particular excess” what we call “faiz”.
In the Era of Ignorance (the pre-Islamic era), the main debt was called “ra’sul mal”, and the excess as “riba”. Today’s interest procedures, in respect of qualification, are no different than those of the pre Islamic era. Decreasing or increasing the interest amounts or types, from time to time, does not change the attribute of that act. So, the interest in the pre Islamic era customs is exactly the same as what is called “faiz” or “nama” today (both words have the meaning of “interest”). Doubtlessly, in dictionary its most suitable name should be “riba”, “the excess” or “the left”. The reason, why it is used as “faiz” or “nama”, is because of misunderstanding the verse "Trade is like usury" (Qur’an, Al-Baqarah, 2/275) and by comparing that verse to buying-selling and trading. (Elmalılı, ibid, II, 952,953).  
Unless an attribute of something changes, the change of the name does not change the decree about it. So, the decrees about “riba” are also used for “faiz” which has the same judicial features. This is like saying the “ijara agreement” (contract of employment in the Ottoman State) as “renting agreement” both of which have the same meanings.
Islam, when solving the problems related to community about social and economical cases, has complied with the principle of “tadrij” (gradualism). Usury was an important way of earning money for Arabs especially for high-class people. It was not suitable to stop it at a bound. Thus, the prohibition of the “riba” underwent a gradual process just like the prohibiton of alcohol.  
Abu Hurayra narrated the following from Hazrat Prophet: “The night of miraj (Our Prophet Muhammad’s ascension), I came across with a crowd whose stomachs were as large as houses. There were snakes, visible from outside in their stomachs. When I asked Gabriel (Jibril) (peace be upon him) who they were, he answered: ‘They are those who received interest.’”  (Ibn Majah, Tijarah, 58; Ahmad b. Hanbal, Musnad II, 353, 363). As the event of the Miraj occurred around the year 621 (Gregorian calendar) in Makkah, it was pointed out then that interest would be prohibited in the future. It was stated in a verse that was revealed in Makkah that usury would not increase one’s property (Qur’an, Ar-Rum, 30/39). And in a verse revealed in Madinah, it is expressed that in the Torah, interest had been prohibited for Jews but because they did not comply with that prohibition, the things that were halal (permissible) for them had been made as haram (forbidden).(Qur’an, An-Nisaa, 4/160)
And with the following verse, partial prohibition was commanded:
“O you who believe! Devour not usury, doubled and multiplied; but fear Allah that you may (really) prosper.” (Qur’an, Aal-e-Imran, 3/130)
Here, with the word “usury”, “compound interest” is meant. The Qur’an, without any distinction between little and much interest, prohibits interest absolutely with these verses:
“Allah has permitted trade and forbidden usury” (Qur’an, Al-Baqarah, 2/275). but those who repeat (the offence) are companions of the Fire: they will abide therein (for ever) (Qur’an, Al-Baqarah, 2/275).
“O you who believe! Fear Allah, and give up what remains of your demand for usury, if ye are indeed believers. - If you do it not, take notice of war from Allah and His Messenger. But if you repent, you shall have your capital sums: Deal not unjustly, and you shall not be dealt with unjustly.” (Qur’an, Al-Baqarah, 2/278, 179)
According to most of the interpreters, the verses of interest were revealed because of the interest problem of the tribe of Bani Thaqif. The interest of assets and liabilities of that tribe had been abolished in the Taif agreement made with Hazrat Muhammad (pbuh
There emerged hostility when the Sons of Muqhira did not pay their debts to the Sons of Umayr who were from Bani Thaqif. Hazrat Prophet was informed about the situation in writing by the governor of Makkah, Attab b. Asid (d. 13/634). Thereupon, the verses of interest were revealed and Hazrat Muhammad sent the related verse to the governor. In addition, our Prophet (pbuh) wrote to the governor, “if they accept that command, it is all right; otherwise, declare war against them”. Thereupon, the people of Taif gave up their demands. (At-Tabarî, Tafsir, 105, 106; Elmalılı, ibid, II, 972). The conquest of Makkah and Taif took place in the 8th and the last pilgrimage (hajj) in the 10th years of Hijra (Emigration). Hazrat Prophet started the prohibition of interest with the following words: Watch out! All of the usuries of the Era of Ignorance has been laid aside forever, and the first usury I begin with is that which is due to my father’s brother ‘Abbas ibn ‘Abd al-Muttalib.. (Muslim, Hajj, 147; Abu
Dawud, Buyu', 5).
The interest that Islam prohibits is divided into two parts. The interest of nasia and excess:
a. The interest of nasia (riban nasia): This is the kind that was known and carried out in the era of ignorance. This kind of interest is carried out in accordance with the time which occurs through sale contracts and by granting loans. If the debt is not paid in its deadline, an extra amount of interest is added through new contracts. In the Qur’an, that kind of interest is pointed out and is prohibited:     
“O you who believe! Fear Allah, and give up what remains of your demand for usury, if ye are indeed believers. - If you do it not, take notice of war from Allah and His Messenger. But if you repent, you shall have your capital sums: Deal not unjustly, and you shall not be dealt with unjustly.” (Qur’an, Al-Baqarah, 2/278, 179)
b. The interest of excess (ribal fadl): This is what is mentioned in hadiths and means to sell the same kind of goods by declaring two prices such as exchanging one-scale-wheat for two-scale-wheat...    
From Ubada b. Samit, it was narrated that Hazrath Prophet said the following: “Gold with gold, silver with silver, wheat with wheat, barley with barley, date with date and salt with salt, can be exchanged equally and simultaneously. However, if their kinds are different, -as long as it is in cash- you can trade however you like.” (Muslim, Musaqat, 81; Abu Dawud, Buyu',18; Ahmad b. Hanbal, V, 314, 320). The hadith in the book of Tirmizi has the following addition: Whoever gives the excess amount or receives it during that exchange, it is certain that he will have committed interest.

5 Is network marketing religiously permissible? Is the bonus that is gained through the web of sale religiously permissible?

We cannot entitle a trade which is practiced via Internet or another way as “forbidden by religion” if it is not about one of the forbidden things for Islam as interest, deception, using someone’s goods without right, gaining profit through gambling or selling forbidden things by Islam like alcoholic beverage or pork; if there is no cheating in it and if it does not urge luxury consumption.

As for the system mentioned in the question, the system, by looking from the Islamic perspective, has inappropriate aspects like the following:

1. The system says to people “Find many people, then the people underneath you will work. You will get income till the end of your life.” And it makes people lazy. There is not any useful  production that is beneficial for the people and the country.

2. If you buy the service or product, you do not have the right to give it back. In terms of Islamic trade rules, if an object is bought,  it has to be on hand and its properties have to be known but  this system does not comply with this rule.

3. The members get money as they find new members but in fact, the fake company established in different countries gains most of the money. None of any part of the income gained in Turkey is paid as tax in our country. All of the procedures are made via internet. The national capital and savings are transferred to foreigners through illegitimate ways.

According to the explanations made about the working principles of the system, we can understand that the object bought is unclear. What is more important is “if someone wants to leave the system, he/she gets nothing”. It means nothing is taken; the process is for effect. Then, a process like this cannot be religiously permissible.

6 There are so many banks that claim to be "Islamic", that is "Interest Free" banking. Could you explain please which banks are preferable?

The institutions that function based on the system of profit and loss are permissible because our religion regards them as commercial institutions. Money can be invested in those institutions and the profit share given by them is halal (legitimate).

Interest-free finance houses (Prof. Dr. Hayrettin Karaman)

Interest-free Finance Houses usually carry out the transaction of murabaha (selling on profit) due to the special conditions of Turkey. The term murabaha means buying goods at cash price and selling them at deferred payment price. When the private finance house determines the deferred payment price, it takes some criteria into consideration; among those criteria are inflation, the probable yield of the money in the market when it is invested in other instruments, and some other things... The finance house has to meet the expectations of its shareholders that invest money (the holders of profit and loss accounts). A shareholder (account holder) that invests money with the expectation of profit will withdraw his money if he cannot even receive the inflation difference, that is, the value loss caused by inflation, and the finance house will be unable to operate. It is not enough to compensate the inflation difference; it is also necessary to give some real profit. Since the deferred payment price is arranged based on those necessities, it sometimes becomes a bit lower than the bank interest rates and sometimes more than the bank interest rates. However, it is not possible to say that the transaction is illegitimate only by taking that state (that is, the fact that the profit and the interest rates are close to or different from each other) into consideration. In general, the profit in legitimate trade and the sector of industry is like that; sometimes it becomes equal to interest rate, and sometimes it can be different.

Trade is carried out by buying and selling goods in return for a price. Private Finance houses do the same things in the transaction of murabaha. The buying and selling take place in two forms:

a) The finance house appoints its employee to get the goods and to deliver them to the customer; the invoices are issued in compliance with that transaction (two invoices are issued: one by the seller and one by the finance house).

b) The finance house gives the customer who wants to buy goods (according to some questions the person who wants to use funds) written authority to buy goods; the customer buys the goods on behalf of the finance house and the invoice is issued to the finance house; the customer receives the goods on behalf of the finance house and transports it to the place where the finance house wants (it may be his own store or shop); then he buys the goods from the finance house as the customer; this time the finance house issues the invoice to him.

Both transactions are in compliance with fiqh (Islam). It is necessary to know the intention of the parties in order to call it cheating; if the aim is to give/take credit with interest, it is called cheating; if the aim is to really sell goods through deferred payment sale (if the goods are really bought and sold), it cannot be called cheating.

Private finance houses have two more transactions that are nearer to interest-free system – in terms of their economic and social effects - : mudaraba and musharaka.

In mudaraba, a partnership based on the capital from the finance house and the project and administration (labor, enterprise) from the other party is established. Profit is shared in accordance with the contract. The share of the finance house is shared between the bank and the participation account holders that invested in the finance house. If the enterprise suffers a loss, the finance house and the account holders undertake the loss.

In musharaka, partnership of capital is present; an entrepreneur that has some capital but needs some more asks the finance house to add some capital and become partners; a contract is made; the profit is shared in accordance with the contract and the loss is shared depending on the rate of capital. Interest-free banking has many other transactions and services like financial leasing, lending without interest, money transfer, collection of revenues, etc.

In the private finance houses, mudaraba and musharaka are carried out less in comparison to murabaha. Among the reasons why they are carried out less are the impatience of account holders, the expectation of profit without taking risks, the fact that accounts of the companies are partly off the book, lack of reliance and trust caused by the weakening of the consciousness and feelings of trust, keeping promises, loyalty and haram-halal. The better we, Muslims, get in terms of quantity and quality, the better our institutions will be.

Note: We recommend youto read the following views about the issue too.

Private Finance Houses (Participation Banks) and Prohibition of Interest (Sami Uslu)

Private Finance Houses are institutions that are not regarded as banks and that accept funds in accordance with Islamic principles and allows using funds, that functions based on profit-loss partnership instead of interest for the methods of making use of savings and providing loans. The institutions that are named as “Islamic bank”s in the world are called Finance Houses in Turkey.

The fact that the population of Muslims who regard interest as haram have reached a great number in the West have increased the number Islamic finance institutions and caused the other banks to serve those people with the units that they have established.

Islamic banking” is the fastest-growing finance sector in the world. Now, more than 200 Islamic finance institutions that are active in the world, direct a fund with an investment size of 200 billion dollars.

Furthermore, some of the banks that have established interest-free banking units within their organization are as follows:

Citibank-USA, Goldman Sachs-USA, HSBC- England, Deutshce Bank-Germany, Union Bank of Switzerland- Switzerland, Amro Bank-Holland, Kleinwort Benson, ANZ Grindlays Australia, United Bank of Kuwait and Arab Banking Corporation.

All of those institutions, which are among the greatest banks in the world, have interest-free banking in their organization. The list of banks that are starting interest-free banking is getting longer day by day.

Key Characteristics of Private Finance Houses:

1- They are interest-free:

The most distinguishing characteristic of those banks is that they do not carry out transactions with interest. That is, they do not pay interest for the funds that they obtain; they do not collect interest from their customers for the funds that they provide their customers with.

After all, the reason why they have been established is to serve the people who do not carry out transactions with interest due to their religious beliefs and to serve the companies of those people. Islam accepts that capital is one of the production factors and that it has a cost. However, it rejects the idea that the capital should demand a pre-determined yield, that is, interest. In other words, it is forbidden to earn money for money.

2- They are trade-related:

The fact that interest is forbidden, trade and profit are legitimate in Islam urges those institutions carry out trade related transactions with their customers. Since money trade is forbidden in Islam, it is necessary to carry out trade of goods in order to earn money.

3- They are equity related:

It is a generally accepted truth that pure Islamic banking includes loss-profit partnership (mudaraba) or capital participation (musharaka).

The capital owner can share the profit with the entrepreneur obtained thanks to his expertise and effort. The rate of the profit, which is the yield of the capital, that is, in what percentages it will be shared is determined beforehand but the amount is not certain.

4- The investments should be ethical:

The investments should be made within the framework of legitimate fields in terms of Islam. In this context, Islamic investments should be environment-friendly, alms-giving, enabling the participation of the community, respectful to humanitarian values, excluding pornography, armament, alcohol and gambling.

Primary products and services of private Finance Houses

1- Mudaraba and Musharaka:

They are the basic methods that form the essence of the Islamic banking in terms of fund using. However, since the yield comes in the long term, those transactions are not used sufficiently. It is indisputable that mudaraba and musharaka are in accordance with Shariah.

2- Leasing Transactions:

In the transaction of leasing, the finance house buys the machinery and equipment, rents it to the customer and collects the price of them in the form of installments. In our opinion, it is outside the prohibition of interest.

3- Murabaha:

In this method, the finance house buys the machinery, etc that the customer needs on behalf of the customer and sells it to the customer by adding some profit to them. The price of the goods is repaid to the finance house by the customer in the form of installments.

It is claimed that murabaha contains covered interest and that it resembles interest rather than commercial profit because it does not contain the risk factor that should be present in normal trade and the yield is predetermined. We do not think that those criticisms are right due to the following reasons:

• Murahaba is a kind of trade that is carried out upon ordering and that kind of trade is widespread in every market.

• The cost plus method used in pricing is a frequently used method in trade. It is completely normal that the seller adds a certain percentage of profit to the cost. That is, the profit margin is predetermined.

• The claim that murabaha does not contain the risk of the normal trade is not true. There exists the risk that the customer may not pay the price just as in the normal trade. It is called market risk or counter-party risk in terminology.

One of the most criticized issues is that the rate in the deferred payment price in murabaha is about the same as the rate of interest of the other banks and therefore it is covered interest.

In our opinion, that criticism is groundless because every merchant in the market has to consider the rate of inflation when he prices the goods for deferred payment. A deferred payment rate under the rate of inflation will inflict a loss on the seller. Similarly, private finance houses have to add a difference to the cost at least equal to the rate of inflation. The rate of inflation is the primary element that determines the rate of interest and it is generally in parallel with the rate of interest. Therefore, it is natural even necessary in terms of economy that the rate of deferred payment and the rate of interest is close to each other.

Therefore, the fact that the deferred payment rate is close to the rate of interest does not make murabaha an interest transaction. As it is explained above, private finance house function in an economy based on interest; it is not possible for the pricing of the funds to be unaffected by the current rates of interest.

Those explanations are also valid for leasing.

4- Buying and Selling Documents in Return for Goods

It is a method of providing funds by Private Finance Houses that form a “grey field”. Documents belonging to an export party realized thorough deferred payment sale are bought from the exporter in return for cash; then, they are sold to the same exporter by adding a difference of deferred payment and the money is collected in the form of installments. For instance, documents having a value of 50 thousand dollars are bought by the finance house from the customer in return for 45 thousand dollars and that amount is paid to the customer at once; simultaneously, the customer sells the documents to the finance house for 50 thousand dollars with deferred payment sale. 5 thousand dollars is the profit of the finance house and the cost of the customer.

It is very difficult to ignore that it is a transaction of discount no matter how good-intentioned you are. As a matter of fact, it can be claimed that those documents represent the goods and that they are tradable goods as in murabaha. However, it is very disputable to regard that defense as valid because the export subject to that transaction is a finished export. The goods have left the Turkish customs and probably have reached the country where the buyer is; at least, they are on the way somewhere outside Turkey. At any rate, the ownership of those goods is not in the exporter. However, the exporter is the debtee and a policy or bond among those documents proves that he has the right to receive the money. The document that the finance house buys and sells back is not the goods but the proof that the customer has the right to receive the money. The deferred debt that the exporter will receive in the future is paid to him now and an amount of money is collected from him. In other words, the customer is sold the time. It is called the time value of the money in finance and it is interest.

A policy or bond that bears the signature of the foreign importer and sometimes also the signature of the guarantor bank is a finance instrument. That document is arranged by the importer as an alternative for cash payment. That is, the importer has arranged a debt document in return for the transfer of the ownership of the goods to him.  That bond has two uses:

a- It proves the debt relationship that originates from the foreign trade transaction in question.

b- It enables the exporter to transform the price of the export into cash by discounting it in a bank or finance institution without waiting for the redemption date.

The conclusion to be drawn from it is that the Private Finance House has a structure that is suitable to support exports before shipment not finished exports. The raw materials and intermediate goods to be used in the goods to be exported can be provided for the exporter through murabaha. When the export of ready-made goods is in question, those goods can be sold to the exporter through murabaha.

Pricing Services and Products

We sometimes observe that the services and products presented by Private Finance Houses are expensive and that they discontent and disappoint customers due to the prices higher than those of the commercial banks. Some people put forward that high pricing harms the Islamic characteristic of those institutions and puts them in the same level as banks with interest religiously.

First of all, we should state that high pricing does not transform a sound transaction into a transaction with interest religiously. For instance, a letter of guarantee given by a Private Finance Institution does not have any drawbacks religiously. The commission taken in return for that service is naturally legitimate. The fact that the rate of the commission is high does not turn the transaction of the letter of guarantee into a haram transaction.

However, criticisms stating that the customer is misused in terms of high commission and price that the trust is abused and that the amount taken for the service is high.

On the other hand, excessiveness in pricing can be regarded as an indication that the private finance house works with a high cost or that it carries out a wrong marketing policy.

What determines in which level the commissions and prices are regarded as reasonable is the market conditions and competition. In theory, a private finance house that charges more money than its competitors will fall behind and its market share will decrease. It is the punishment given to that institution by the market. Although what we have stated is true in theory, it is difficult to say that there exists real competition between the private finance houses and commercial banks in terms of customers because what determines the preference of the customer is the religion. The customers of those institutions do not actually go to private finance houses in order to receive cheaper service; the peace and comfort of acting in accordance with Islam plays an important role in preferring the bank that they need for banking services.

Therefore, the competition can be only among the private finance houses. Thus, the private finance houses should take that aspect of the issue into consideration when determining the prices for their customers and they should carry out pricing policies that will make them gain normal profits.

7 What are the criteria for social intercourse with non-Muslims? Is it permissible to be business partners with them?

It is permissible to trade with a non-Muslim person. It is also permissible to see a non-Muslim doctor. There is not a religious objection to it. The Prophet (pbuh) told al Haris bin Kalda to work as a doctor though he was not Muslim. (Awnu’l-Mabud sharh Sunen Abi Dawud, vol. 4, p. 14, India).

While migrating from Makkah to Madinah, the Prophet hired an idolater guide who knew the way well. The tribe of Khuza’a, both their Muslim and non-Muslim members, were the Prophet’s confidants. (Halil Günenç, Günümüz Meselelerine Fetvalar II. 285)

If there are Muslims who sell the same things we want to buy, we can prefer them. However, it is religiously permissible to trade with Jews, Christians and other non-Muslims.

The authority prohibited in the Quran is about authority of representing and managing. Islam prohibits authorizing non-Muslims to represent Muslims and govern them. Apart from it, relationships and behaviors such as being business partners with non-Muslims, being neighbors, being friends and offering them food are not prohibited. Islam also orders people to treat non-Muslims well and to pay attention to the criteria of justice in relations with them. (al-Mumtahina: 60/8)

THE CRITERIA FOR RELATIONSHIP WITH NON-MUSLIMS

Islam is a means of happiness and mercy for humankind. Its wings of affection and wide tolerance embrace the ones who do not follow it as well. The followers of other religions found the comfort and peace which they could not find in their own religions in Islamic countries and they pursued their lives there without being subject to any problems. Muslims obeyed the divine orders on the issue strictly and applied them widely.

“And dispute ye not with the People of the Book, except with means better (than mere disputation), unless it be with those of them who inflict wrong (and injury): but say, "We believe in the revelation which has come down to us and in that which came down to you; Our God and your God is one; and it is to Him we bow (in Islam)." (1)

The translation of another hadith which confirms the previous one is as follows:

God forbids you not, with regard to those who fight you not for (your) Faith nor drive you out of your homes, from dealing kindly and justly with them: for God loves those who are just.” (2)

How Muslims should live with people of the Book and non-Muslims who live in Islamic countries and the rules that should be followed mutually are stated under the light of many other divine orders and hadiths, like the ones the translations of which we have written above. Our religion has never ignored them by saying “they are infidels” and has not broken the relations off with them, and acted together with them in many situations.

Relationships with Jews and Christians are not about their beliefs. Friendship made with them is not for their Jewishness and Christianity. What should be approved about them is some of their good characteristics and jobs because,

Just as each characteristics of a Muslim is not necessarily Muslim, each characteristic of an infidel is not necessarily infidel, either. In this sense, why should it not be permissible to benefit from a Muslim characteristic by appreciating it? If you have got a wife from the people of the Book, of course you should love her.
On the other hand;

Your friendship with them means to appreciate their civilization and development and to benefit from them (adapting them into our culture). And the essence of each worldly bliss is the protection of peace.”

It is because;

There is not obligation to mix beliefs with procedure (of religion).” (3) That is to say; there is no obligation to mix beliefs with human relations.

It is possible for a Muslim to act together with the followers of other religions or with those who do not have any faith in some situations except faith issues, and to have social intercourse with them. It is natural for people who live in the same country or in the same world to share their ideas with each other on some issues and to have commercial or political meetings. This situation is seen both internationally and interpersonally; because, no matter how infidel one can be, s/he may have some humane characteristics. There can be some features of his/hers which do not result from his/her infidelity. For instance, s/he may do some things which are beneficial for humankind or may have some good characteristics.

Our religion does not totally break relations off with non-Muslims but shows how to have relations with them within some criteria, due to the togetherness caused by living together in the same world.

It does not permit Muslims and non-Muslims living in the same land to treat each other like enemies even though their beliefs are different. Our religion permits marriage with women from the people of the Book, eating their dishes and considers it a duty to visit non-Muslims when they are sick and ask how they are as a part of law of neighborhood.

Those duties are at the same time suggestions of our religion.

I am the enemy of those who treat the people of the Book living in Islamic countries badly” (4) says our Prophet and orders Muslims to protect non-Muslims’ rights and not to cause them troubles.
Islam, which permits the people of the Book to live peacefully in Islamic lands with the freedom of praying and belief, applied that tolerance quite permissively.

The principles pointed out by those explanations are regarded as interpretations of the verses we mentioned before. All kinds of relations with the people of the Book are considered to be lawful and permissible on condition that they are not haram (forbidden). In fact, Our Prophet bought thirty sa’ (half of a load a camel can carry) of barleys on credit from a Jew called Abu Shahma and left his armor to him as pawn. (5)
From that hadith, the following judgments are deduced:

1) Trade with the people of the Book is permissible.

2) The property which the people of the Book have got is their right.
3) The Prophet was not eager about worldly materials and had only sufficient amounts of them to stay alive.

4) Just as pawning is permissible, it is also permissible to leave a war material to a non-Muslim living in an Islamic country as a pawn. Also, pawning is permissible in the time of peace as well. Moreover, trade of non-forbidden things with other non-Muslims who are not the people of the Book is also permissible. (6)

The Quran states that dishes cooked by the people of the Book can be eaten and Muslim men can marry to women from them in the following verse:

“… The food of the People of the Book is lawful unto you and yours is lawful unto them. (Lawful unto you in marriage) are (not only) chaste women who are believers, but chaste women among the People of the Book, revealed before your time, - when ye give them their due dowers, and desire chastity, not lewdness, nor secret intrigues…” (7)

The interpreters of the Quran say that what is meant by the food mentioned in the verse is the animal slaughtered by them. Fahr-i Razi is one of them. The following event which took place in the Era of Bliss is a clear proof that meat slaughtered by the people of the Book can be eaten, too:

After the Prophet (pbuh) conquered Khyber, he stopped to have a rest. Zainab, daughter of Harith who is a Jew from Khyber, asked: “Which part of the meat does Mohammad like eating the most?” They said that he liked eating foreleg meat and shoulder the most. Zainab slaughtered a goat right away and fried it. Then she applied a fatal poison all over it. She poisoned the foreleg and shoulders more than the other parts. She took it to where the Prophet was resting and said: “O Aba Qasim, I present this to you.” The Prophet (pbuh) took a part from foreleg and put it in his mouth. However, he did not swallow it and took it out. He said to his companions: “Do not touch the food! That foreleg told me that it is poisoned.” (8) As it is seen here, the Prophet would not hesitate to eat from an animal which is slaughtered and cooked by a Jewish family.

Just as it is permissible to accept a present from the people of the Book, it is also permissible to give them presents. 
For instance, the Prophet  sent presents with his envoy to foreign governors to whom he sent letters to invite them to Islam, and he accepted the presents they sent to him in return.

When the Prophet (pbuh) was in Madinah, a famine started out in Makkah. The Prophet helped those who were in danger of starving even though they were idolaters. He sent 500 them gold coins. He wanted Abu Sufyan and Safwan to be set free and wanted them to distribute those gold coins to the poor of Makkah.

Judging from this event, the Islamic jurisprudents said that it was permissible for Muslims to give presents to and accept presents from non-Muslims. (9)

Another event which took place in the Era of Bliss enlightens the issue. Asma, daughter of Hazrat Abu Bakr narrates:

My mother, who was an idolater at the time of the Prophet, one day, came to me with some raisins and oil as presents. I did not want to accept the presents and let her into my house. I came to the Messenger of Allah and asked:

O Messenger of Allah, my mother came to me with her son Harith. She wants to be intimate with me and to be cared for. Can I respect my mother and behave courteously to her? The Messenger of Allah said: “Yes, respect your mother and be courteous to her”. (10)

As it can be deduced from the hadith above, the Prophet (pbuh) suggested Asma to accept food her mother brought and respect her even though she was an idolater. Bukhari, who mentioned this hadith in the section under the title of “The permission for a Muslim to give an infidel presents”, states that the hadith is proves the issue.

Both the generosity that Our Prophet showed to Makkan people and the permission he gave to Asma is another proof of that he contained all high moral qualities in himself because it is also about visiting relatives. Even though one’s relatives may be non-Muslims, s/he should not break off the relations with them. If one has got a non-Muslim relative, they should help him/her when necessary, should visit him/her when s/he is sick; if s/he calls them over, they should accept and eat from his/her food and if there is an argument between them, they should not speak any offending words for him/her. It is also permissible to marry women from the people of Book. Besides human relations, non-Muslims also fought on the same side with Muslims. There were approximately eighty idolaters in the Islamic army in the battle of Hunain after the conquest of Makkah. They fought together with Muslims.

The most important point on such issues which should be taken into consideration is trying to show them Islam in a positive way, by living as a good Muslim; because, one day they might appreciate a word or a behavior and this may lead them to the right path.

 In addition to all of them, some people claim that there is difference between the people of the Book who lived at the time of the Prophet Mohammad and the people of the Book who live today, and say that those judgments are impossible to be applied today.

Let us state this firstly:

The Quran is not a book that addresses to only a certain age or a certain period of time. The Quran sustains its freshness and newness to every age, as if it was sent down again. For this reason, the judgments of the verses are valid until the Day of Judgment.

On the other hand, it cannot be said that there is a lot of difference in terms of belief between the people of Book of that time and the people of Book of our day, and that they were better than the people of the Book of today. As a matter of fact, the people of Book who lived in the Era of Bliss are characterized as sinners in a Quranic verse:

“Say: "O people of the Book! You disapprove of us for no other reason than that we believe in God, and the revelation that hath come to us and that which came before (us), and (perhaps) most of you are rebellious and disobedient.” (11)

Again in the chapter al-Fatiha, Christians and Jews are characterized as “strayed” and “those who deserved the wrath of Allah’s”.

The people of Book who lived in the Era of Bliss and the people of Book who live today agree on the issue of belief in Allah. For instance, Christians believed in trinity in the Era of Bliss and today they still do. Besides, the Christians today gradually tend to believe in oneness of God instead of trinity. We sometimes read in newspapers about the Christians who converted into Islam. Is it not a proof to the issue?

That change can also be observed in social structure. For instance, as Christian countries are managed in an atmosphere of freedom and democracy, the social structure in those countries are favorable for Islamic service and developments, and they also provide Muslims an opportunity to live in peace. When taken into consideration that the Muslim population in those countries is growing day by day, this issue can be comprehended better. Badiuzzaman Said Nursi stated the following seventy years ago: “These days we almost see with our own eyes the tidings of that Europe is pregnant with Islam and one day it will give birth to an Islamic country.” The facts that Austria accepted Islam as one of the official religions, that European countries, primarily Swiss, Norway, Germany, France and England, provide convenience for Muslim population are each a positive development.

Furthermore, Muslims receive important rights in countries which are governed by democracy and those rights are also provided by the governments themselves. In those countries, no Muslims are repressed for wearing headscarf or performing other religious orders. The positive developments in terms of Islam in such countries will be better comprehended when it is taken into consideration that reciting of the Quran and religious programs are permitted in television channels of some European countries such as France, the Netherlands and Spain, and that call of prayer (adhan) is permitted in the Netherlands.

Footnotes:

1. al-Ankabut, 46.
2. al-Mumtahina, 8.
3. Münazarat, p. 26-28.
4. Kashfa’l-Khafa, 2: 2341.
5. Muslim, Musaqat: 24: Ibn Majah, Ruhun: 1.
6. Nawawi, Sharhu Sahih-i Muslim, 11: 40.
7. al-Maidah, 5.
8. Ibn Hisham, Sirah, 3: 352.
9. Ibn Abidin, Raddu’l-Mukhtar, 5: 420.
10. Bukhari, Hiba: 26.
11. al-Maidah, 59.

Mehmet Paksu

8 Is International Trade Permissible in Islam?

It is permissible to make trade with non-Muslims. We can prefer Muslims if there are Muslims who buy and sell the same things. However, in terms of religion, it is permissible to make trade with and to go into partnership with Jews, Christians and non-Muslims.

Allah does not forbid relations and attitudes like partnership, having good neighborhood relations, ordinary friendship and giving them food. Allah orders us to treat non-Muslims well and to act in accordance with the criteria of justice in relations with them. (al-Mumtahina: 60/8).

“Allah forbids you not, with regard to those who fight you not for (your) Faith nor drive you out of your homes, from dealing kindly and justly with them: for Allah loveth those who are just.” (al-Mumtahina, 8.)

Our religion has never cut relations with non-Muslims saying they are unbelievers; it has acted together with them regarding several issues that are not connected with belief.

It is possible for a Muslim to act together with the members of other beliefs or faithless people regarding some issues that are not related to belief and to have civilized relations with them. It is natural for people who live on the same land or the same world to exchange ideas regarding some issues from time to time and to have commercial and political negotiations.  It may take place both between nations and individuals because a person may have no belief but he may have some humane qualities. He may have some acts that do not originate from his unbelief. For instance, he may do something good for the humanity; he may have some good characteristics.

Our religion has not cut relations with non-Muslims completely. It has shown us ways of having relations with them based on some criteria due to living in the same world with them.  

Saying ‘I am the enemy of a person who agonizes a zimmi (non-Muslim living in Islamic country)’ (Kashfu’l-Khafa, 2: 2341), our Prophet (pbuh) ordered Muslims to protect the rights of non-Muslims and not to agonize them.  

The criteria that those explanations show are like the interpretation of the verses that we have mentioned. All kinds of transactions with the People of the Book are regarded legitimate and permissible as long as they are not haram. As a matter of fact, our Prophet (pbuh) bought thirty sa’ (half the load of a camel) barley from a Jew called Abu Shahma on account and left his iron armor as a pledge. (Muslim, Musaqat: 24: Ibn Majah, Ruhun: 1.)

The following judgments are made from the hadith above:

1) It is permissible make trade with the People of the Book.

2) The property that the People of the Book have belongs to them.

3) It is regarded permissible to buy and sell things that are not haram to other unbelievers that are not from the People of the Book.( Nawawi, Sharhu Sahih Muslim, 11: 40.)

The Quran is not a book that addresses only a certain century or time. It maintains its freshness and youth as if it is sent down again in each century. Therefore, the judgments and decrees of its verses are valid until the Day of Judgment.   

On the other hand, it cannot be said that there is a difference between the People of the Book that is mentioned in the Quran and the People of the Book that live today; it cannot be said that the People of the Book living at that time are better than the People of the Book living today. As a matter of fact, the People of the Book that lived during the time of the Prophet are qualified as rebellious and disobedient in a verse:

“Say: "O People of the Book! do ye disapprove of us for no other reason than that we believe in Allah, and the revelation that hath come to us and that which came before (us), and (perhaps) that most of you are rebellious and disobedient?"(al-Maida, 59.)

9 Can the answers you give be taken as fatwa ?

Harams are evident in our religion (Islam). All Halals cannot be stated one by one. Here is the rule; If there isn't any judgemet or a rule against something in Islam then it is considered Halal. We only express Fatwas that were given beforehand, so you can take them. If you have any questions or suspicions, you can ask us.

10 Is it permissible to export "revealing style women garments" to Non-Muslim countries?

The production like that is permissible; the money earned out of it is halal (permissible). If some people use them in inappropriate places, it is their responsibility.

11 Can you dispel my doubts about exporting "revealing style women garments"?

In the religion of Islam, if something itself is haram, then the sale of that thing becomes haram. For instance, alcoholic drinks and pork, because they themselves are haram.
If something that is not haram is sold and the person who buys it uses it wrongly, the seller will not be responsible for it. For instance, there are computer programs. A person who buys them can use them for something good or bad. In short, whether the thing that is sold is haram or not is important. If it is halal, the seller will not be responsible when the buyer uses it wrongly.

If you want to remember the previous posts, please click on the links given below;

Is it permissible to export "revealing style women garments" to Non-Muslim countries?

Can the answers you give be taken as fatwa ?

12 What is Islam's view of Business Life and Economic development?

Adam Smith is described as the father of economics; he is regarded to have founded the free market economy. His book called “the Wealth of Nations” was published in 1789. The essence of the book is based on this idea: The best thing to do about the economy is not to intervene in the market at all because the market always does the best. That famous idea is expressed with the maxim ‘Let do’ (Laissez fairez). The reason on which Smith bases his ideas is very interesting. He says there is an invisible hand that rules the market; what he means by the invisible hand is God. Were those ideas that are still regarded as the basic doctrine in economy put forward by him for the first time? Let us have a look at the history of Islam to find the answer.
In the Age of Bliss (the Era of the Prophet), when people demanded an official fixed price, Hazrat Muhammad brought the principle of not intervening in the prices by any means and said the following as a reason; "Only Allah knows where prices will go." Those words that describe the system of liberal economy concisely match up with the definition of Smith. It is certain that one of them quoted from the other.

Since our Prophet lived about 11 centuries before Smith, it is clear who quoted from whom. On the other hand, our Prophet objected to liberal economy’s acting like wild capitalism by saying, "Pay the worker his wage before his sweat dries." In addition, practices like zakat (obligatory alms), qard hasan (loan without interest) and sadaqa (voluntary alms) are the new practices of Islam aiming at eliminating injustice in the income distribution. On the other hand, 12-13 centuries had to pass and the community had to undergo unbelievable pains for the West to regard workers as humans.  

Trade is the lifeblood of the economic life. In a broad sense, it can even be said that economy=trade. The following hadith of the Prophet of Islam regarding the issue is a clear message: "Be courageous and be involved in trade. Nine out of ten of the sustenance is from trade." Our Prophet stated that trade had risks but he advised us not to avoid risks. In addition, he expressed a macroeconomic phenomenon that is generally accepted today informing us that almost all of the gross national income originated directly or indirectly from trade both in the country and in the world. However, the Christian clergymen regarded trade and fraud equal until recently and named selling something at a price higher than its cost as theft.

In the holy book of Islam, the Quran, it is ordered that the information about the trade be written and recorded. Thus, Islam showed the way of recording the information and transactions about trade correctly in the books of the companies, which forms one of the essentials of the companies today, and preventing shadow economy, which is the source of many evils. As a matter of fact the contemporary accounting system was started by Arabs for the first time thanks to the decree of the Quran. It took the West several centuries to reach that level in accounting and incorporation.

The Messenger of Allah presented all of the leaders of the world with a divine guide for success by saying, "The head of a community is the one who serves that community the most." A serving leader is an issue that contemporary management science has just started to search.

13 Is it permitted to practice as a mortgage associate ?

Mortgage, which means pledge, is used to define a kind of real estate financing system.
Finance company buys a real estate in the name of the customer and delivers it to the customer. However, the real estate is pledged/mortgaged in return for the customer’s debt to the finance company. Then the customer makes his monthly payments to the finance company within a predefined period of time and payment plan.
If the system you will join runs this way, it is permissible. However, if it makes you use credit and charges interest out of it, then it is not permissible.

14 Is it appropriate to pay commission to someone who works in a company that we desire to sell our products to, in order to persuade them to buy your products?

This kind of payment is called bribe, not commission, because a wageworker in that company is offered some interest in order to have this job done, which is actually bribe. 

Those who are employed as civil servants or workers in government offices serve and are paid as a requirement of contract made between the state (public) and themselves, or those who work in any workplace in private sector serve and are paid as a requirement of contract made between the employer and themselves. In this sense, they are supposed to do their jobs as well as they can and honestly. 

If the purchase agents in question are paid by the company they are working for, they have got no right to demand commission from you. 

People who work for a company on salary should not be offered extra payment or they should not be paid even if they demand to be paid. If they are paid or if they demand a payment, it is ill-gotten gain and bribe. 

If employees working in any kind of workplace work on “salary + premium payment”, salary and premium payment to those employees must be paid by the company that has employed the employees in question. 

In short, people should comply with the conditions which they agreed upon in their working contract. And employers should be loyal to their employees’ rights.

Our religion requires us to be respectful of individuals/public’s rights. In addition to this, it is stated that if one violates another’s rights, he cannot be forgiven unless the one who is wronged forgives him.

In the Farewell Sermon, the Messenger of Allah (pbuh) said: “O people! Your lives, properties, honor and purity are forbidden to each other unless you reunite with your Lord (you are forbidden to harm them)” (Bukhari, Hajj, 132).

The most important traits of a Muslim are honesty and trustworthiness. Straightness, honesty and trustworthiness cannot be sacrificed for the sake of any worldly interest. We would like to thank you for your sensitivity on this subject as well.

Presidency of Religious Affairs

15 Is it permissible to buy the products of foreign countries?

It is permissible to buy and use the products of non-Muslims. Therefore, there is no drawback to using any products that are not forbidden by Islam produced by non-Muslims. 

If it is certain that a weapon or a product will be used against Muslims, it is not permissible to work in its production or to buy and sell it. According to the following rule, such a person is held responsible. "A person who causes something is like the one who does it." Therefore, if a person buys and sells a product that is definitely known to be used against Muslims, he will be held responsible. It is necessary for Muslims to be careful about it.

16 The Muslims working in countries like Germany, Belgium and the Netherlands deposit their money in banks in order to keep them. Is it permissible to receive the interest given by the banks?

The Muslims working in non-Muslim countries should prefer to send their money to their own countries instead of depositing them in the banks where they work. For, it is not appropriate to give the profit of the money they earn to non-Muslims.

However, if they deposit their money, they should receive the interest; they should not leave it to the bank thinking that interest is haram. For, the decree is clearly stated in a hadith mentioned in fiqh books that Muslims can receive interest from non-Muslims in non-Muslim countries. 

In that case, it is necessary to receive both the capital and the interest from the non-Muslims. If they get stronger with our money, it means we get weaker. Our national and Islamic consciousness should not allow such a mistake.

It is a known fact that a Muslim is not allowed to receive interest from a Muslim even if they are in a non-Muslim country.

for further information, please click on the link given below;

Is it haram to receive and give interest in dar al-harb? Is interest permissible in non-Muslim countries?

17 It is permissible to buy things from Jews and to do business with them?

It is permissible to do business with non-Muslims and to use their products. However, they must not be among the things that were forbidden by Islam. We do not know whether the companies whose names appear in the list on the Internet support Jews or not. Therefore, it is not appropriate to have a negative attitude against all of them.

However, if those companies state that they support Jews, the decree changes. If it is certain that a weapon or a product will be used against Muslims, it is not permissible to work in its production, to sell or to buy it. Such a person is held responsible in accordance with the following decree:  "A person who causes something is like the one who does it."

Therefore, if a person buys and sells a product that is definitely known to be used against Muslims, he will be held responsible. It is necessary for Muslims to be careful about it.

18 Are auctions permissible? Is there a religious drawback to buying a product in auction on the internet? Is the money paid in order to join the auction halal?

Auction is a kind of sale that has two types. One of them was applied by the Prophet (pbuh) himself and the other was forbidden.

According to what is narrated from Anas b. Malik, somebody from Ansar came to Hz. Muhammed (pbuh) and begged something from him. Hz. Prophet (pbuh) asked him, "Do you not have anything in your house?" The man said he had some sackcloth and a container. Upon the order of the Prophet (pbuh), the man fetched them. The Messenger of Allah (pbuh) held the sackcloth and the container and said, "Who will buy them?" One of the Companions said, "I will buy them for one dirham." The Prophet (pbuh) said two or three times, "Who will increase it? Anyone who wants to increase?" Another Companion said he would buy them for two dirhams. The Prophet (pbuh) sold them to him and gave the money to the Ansari, telling him to buy food with some of the money and to buy an axe with some of it, and to bring the axe to him. When the man brought the axe, the Prophet (pbuh) fixed a handle on it with his own hands and told him to cut wood and sell it in the market. He said gaining money like this was better than begging. (Abu Dawud, Zakah, 26)

As it is seen in the hadith, Hz. Muhammad (pbuh) adopted the sale by auction and applied it.

If the money given or taken for the auction is related to registration and expenses, it is permissible.

19 Is the economic system of Islam similar to the liberal economy? What are the differences between them?

Adam Smith is described as 'the father of the economy'; he is accepted to have laid the foundations for the free market economy. His book called 'the Welfare of Nations' was published in 1789. The essence of the book is based on the following idea:

"The right thing to do about the economy is not to intervene in the market at all because the market always does the best."

This view is expressed with the famous slogan 'Let them do (Laissez faire)'. The rationale behind Smith's ideas is very interesting. There is an invisible hand that manages the market; this secret hand means God. Were these ideas, which are still regarded as a fundamental doctrine in economics, really put forward by him for the first time as it has been told to people? Let us look at Islamic history to find the answer.

Answering those who demanded fixing prices officially during the Era of Bliss, Hz. Muhammad (pbuh) set forth the principle of not intervening in prices by any means and stated the following as the reason:

"Allah knows where prices will go."

These words, which describe the liberal economy system in the most concise manner, correspond with Smith's description so much that it is clear that one quoted from the other. On the other hand,

"Give the worker his wages before his sweat dries."

With its approach of social justice, the hadith of the Prophet above opposes the liberal economy acting like wild capitalism. In addition, practices like zakah, sadaqah and interest-free lending are among the innovations of Islam as institutions that aim to prevent injustice in income distribution. On the other hand, twelve to thirteen centuries past and the society suffered unbelievable pains before the West started to regard workers as human beings and adopted the concept of social justice.

Trade is the lifeblood of economic life. In a broad sense, it can even be said that economy = trade. The following hadith of the Prophet of Islam is a very clear message regarding the issue: 

"Be brave and engage in trade. Nine-tenths of sustenance comes from trade."

Our Prophet stated that trade had risks but he advised us not to avoid taking those risks. In addition, he informed humanity that almost all of the gross national income (sustenance) nationally and globally originated from trade directly or indirectly by mentioning a generally accepted macroeconomic phenomenon of our day. However, the priests of the Christian world regarded trade to be equal to fraud until recent ages, saying that selling a product at a price more than its cost was theft.

In the Quran, the holy book of Islam, we are ordered to record information about shopping. Thus, companies are guided to ensure that the business transactions, which constitute one of the most fundamental issues of the business world, are recorded healthily in the books and to prevent informal economy, which is the source of many bad things. As a matter of fact, thanks to this decree of the Quran, the contemporary accounting system was first invented by the Arabs. It has been many years since the West reached this level in accounting and incorporation.

The Messenger of Allah (pbuh) said,

"The master of our community is the one that serves the community the most."

With this statement, He gave all the leaders in the world a divine guide for success. Servant leader is one of the newly studied issues of contemporary management science.

20 We have a tourism company. We send tourists to various places including holiday towns. Are we regarded to have committed a sin when the tourists we transport enter the sea in holiday towns and commit sins there?

There is no drawback to establishing a tourism company, transporting travelers to holiday towns and other places. If these people commit sins in the places where they go, it is their responsibility. You have no responsibility. As a matter of fact, you transport passengers. It is religiously permissible to transport passengers.

21 What are the decrees of borrowing and bankruptcy in Islamic law? In Germany, those who go bankrupt are relieved of their debts six years after bankruptcy.

In Islamic law, debtors are divided into three: 

a. Those who are financially well-off but do not want to pay their debts;

b. Those who are in financial trouble and who do not have any wealth;

c. Those whose debts are equal to their property or whose debts are more.

If a person in the last group cannot pay his debts in time and his existing wealth is less than his debts, the issue of bankruptcy occurs.

According to Abu Hanifa, even if the debt of a person is more than his wealth, this person cannot be put under interdiction (hajr) due to his debts. For, he is fully qualified since he is sane; it is possible for him to increase his wealth through a successful operation. Thus, his freedom of disposition and humanity will be protected. However, in that case, he is ordered to pay his debts. If he does not do so, he is imprisoned so that he will sell his property and pay his debts. The judge cannot sell the property of the debtor. However, he can give his money and his goods of the same kind of his debts to the creditors through istihsan (judicial preference). The reason for imprisoning the debtor is harming and wronging the creditors because of not paying his debts. (al-Maydani, al-Lubab, II/20; az-Zuhayli, al-Fiqhul Islami wa Adillatuh, lV/132)

According to Abu Yusuf, Imam Muhammad, Shafii, Malik and Ahmad b. Hanbal, the debtors whose debts that are due are more than their wealth are put under interdiction by the judge upon the wish of the creditors. This person is regarded to have bankrupted. Malikis do not regard the decree of the court necessary in that case. With interdiction, the transactions that will harm the rights of creditors will be prevented. Transactions like giving property to foundations, donating, giving as charity, entrusting to guardianship, accepting paying debts to somebody else, etc are not valid unless the creditors give permission. If they sell something at market value, the money belongs to the creditors. If the sale is below market value, it depends on the permission of the creditors. The buyer is free to complete the market price or annul the purchase. (Ibn Abidin, Raddul-Muhtar, V/101; Abdülkadir Şener, "İslâm Hukukunda Hacr", A.Ü.İ.F. Periodical, Vol. XXII, p. 339)

Regarding transactions like this, the qualification of the debtor is like a mumayyiz child (above 7 but not of full age). His financial transactions that can harm his creditors are based on their permission. It does not matter whether these transactions are grants like donating and giving property to foundations or onerous contracts that include tolerance in the sale price like selling something below market price or much higher than market price.

The judge sells the property of the debtor who does not pay his debts and divides the money among the creditors. Perishable goods are sold first. Then, vulnerable goods and finally real estate are sold. However, the judge cannot sell the food, clothes, house and similar basic needs of the debtor and his family. (Ibn Abidin, V/103; Damad, Majmaul-Anhur, II/443)

According to Abu Hanifa,  if the judge imprisons the debtor for two or three months, does not see any signs that he has any property or it is understood that he is really poor, he is freed based on the following verse:

"If the debtor is in a difficulty grant him time till it is easy for him to repay." (al-Baqara, 2/280)

However, the creditors follow him. If he becomes rich enough to pay his debts, the creditors will share his wealth. According to Abu Yusuf and Imam Muhammad, poor debtors are not followed until it becomes clear that they have acquired new property. For, the verse above demands some time to be given to them in order to work and earn money. (al-Maydani, ibid, 21-23)

This vast freedom, given by Abu Hanifa to the debtors, was misused in the course of time; debtors sold their property to their friends or relatives, donated them to a foundation or their children, etc in order to escape from creditors. The fiqh scholars that came later issued fatwas stating that the debtors whose debts are more than their wealth cannot donate their property unless their creditors agree even if they are not under interdiction. Ebussuud Efendi, who was the sheikh al-Islam during the reign of Sulayman I and Selim II, stated this issue clearly in the letter that he gave to the sultan. (Hamdi Döndüren, Delilleriyle İslâm Hukuku, İstanbul 1983, p. 144)

If a person who is the protection of any state really goes bankrupt, he is not held responsible for the transactions done in accordance with the rules of that state and he is relieved of his debts.However, if he has not bankrupted but pretends to go bankrupt, or if he earns money but hides it, he will violate people's rights and be held responsible. It is necessary to act according to those criteria.

22 Is it a sin to sell something to somebody that will use it in a bad way?

- The general principle in Islam is as follows: It is haram to be a means of committing a sin knowingly.

In other words, “If a seller knows that the buyer is going to commit a sin with the thing he buys, it is haram for him to sell that thing.” (see Ibn Hajar, al-Fatawa al-Kubra, 2/270)

“…Help ye not one another in sin and rancour…” (al-Maida, 5/2)

The verse above underlies this fact.

Acting upon that principle, the scholars gave the following examples regarding the issue:

a) It is haram to sell grapes to a person who is going to produce wine.

b) It is haram to sell a weapon to a person who is going to cause mischief among Muslims.

c) It is haram to sell a chalice to a person who is going to drink wine with it.

d) It is haram to sell a knife or a similar weapon to a person who is going to use it to waylay.

e) Some fatwas of Ibn Hajar al-Haytami regarding the issue are as follows:

- It is haram to sell musk to an unbeliever who is going to spread it on his idol to beautify it.

- It is haram to sell an animal to a non-Muslim who is going to kill it with a method that is outside normal slaughtering. (see al-Fatawa, 2/270)

f) One of the reasons that renders halal haram is bad intention and bad purpose. Therefore, it is haram to sell weapons at times of mischief. It is haram to sell weapons to unbelievers. It is haram to sell weapons to a person who is going to use it illegitimately. (see al-Mawsuatul-Fiqhiyyatul-Kuwaytiyya, 1/107)

- However, according to Hanafi madhhab, “The form at the time of selling something is essential.”

Accordingly, it is permissible to sell grapes to a person who is going to produce wine. For, at the time of selling, the grapes, which are sold and bought are halal. That it will be changed and transformed into wine later does not affect the grapes’ being halal at that time.

Similarly, it is permissible to sell weapons at times of mischief to the people of business. For, what is a sin and haram is not the weapon itself but using it illegitimately.

However, it permissible without karahah to sell the grapes mentioned above but to sell weapons like that is makruh. For, grapes become a means of sin after their present form is changed but the weapon is used as a means of sin with its present form. (see W. Zuhayli, al-Fiqhul-Islami, 3/580-581)

It means the statements in the question are in compliance with this.

23 Is it haram to work in a factory that produces wine/alcoholic drink? If it is haram, is it necessary for a Muslim to give up that job?

It is not permissible to work in afactory that produces alcoholic drinks and the money obtained from it is haram. It is haram to produce, buy, sell, carry and serve alcoholic drinks. Therefore, it is not permissible to work in such places.

The religion of Islam did not prefer the way of abolishing certain widespread bad habits suddenly; instead, it used a method that started from the minimum level and that led the people to development in a certain direction. For instance, the prohibition of interest is one of the last decrees of Islam. This wound in the commercial life was treated after people reached a certain level with the method of the Quran. Gradualism was essential.

One of the issues in which gradualism was used in prohibition was alcoholic drinks. Alcohol was not prohibited at once; it was prohibited after three verses that were sent down at certain intervals, after the believers were made ready for it. As soon as the Muslims heard that alcoholic drinks were prohibited, they overturned all wine barrels and poured them into the streets. (Muslim, Musaqat: 67)

Not only drinking but also buying and selling alcohol were rendered haram. The Messenger of Allah stated in a hadith that alcohol was cursed in ten aspects:

«Wine is cursed from ten angles: The wine itself, the one who squeezes (the grapes, etc.), the one for whom it is squeezed, the one who sells it, the one who buys it, the one who carries it, the one to whom it is carried, the one who consumes its price, the one who drinks it and the one who serves it.» (Ibn Majah, Ashriba: 6)

(Mehmed PAKSU, HELAL – HARAM)

24 Is it permissible to sell cigarettes?

Hasanayn Mahluf, the mufti of Egypt, states in his book called "Fatawa Shar’iyya" that it is not haram to sell cigarettes. However, even if it is halal, it is not tayyib (clean). Some profits are not only halal but also tayyib, which is a degree of acceptance above halal like selling miswaks.

In cigarettes, there is no benefit for human health; on the contrary, it is harmful. There is no holiness in it like selling something that is sunnah. However, selling cigarettes is permitted due to despair called "umum al-balwa" (public affliction). It is not regarded as clean profit.

UMUM AL-BALWA

Balwa means misfortune, affliction, agony, difficulty etc. Umum means general, everybody. Accordingly, umum al-balwa means an affliction and hardship that encompasses everybody.

Terminologically, umum al-balwa means giving a special decree about something that is hard to avoid and that public is addicted to.

Our religion is a religion of ease. The following is stated in the Quran: "Allah intends every facility for you; He does not want to put you to difficulties." (al-Baqara, 2/185) Therefore, umum al-balwa has been a secondary source of fiqh. The difficulties and afflictions that hit the majority of Muslims are relieved based on this rule. We will give some examples about it:

It is permissible to perform prayers with the clothes smeared by drops of water and mud that are difficult to avoid because they are splashed from the street.

It is permissible for excused people to perform prayers with the clothes smeared due to their excuses.

It is permissible for children to hold the Quran without wudu in order to learn the Quran.

It is permissible to turn one’s front or back part toward the qiblah in the toilets in the buildings. (Ibn Nujaym, al-Ashbah wan-Nazair, Cairo 1968, p. 76-77)

It is permissible for doctors and nurses to look at the private parts of women and men for treatment.

However, the decrees about which there are nass (verses and sound hadiths) cannot be relieved due to umum al-balwa. It is not possible to decree that urine is not dirty due to umum al-balwa since urine easily smears man’s clothes because there is nass regarding the issue. (Atıf Bey, Mecelle Kavâid-i Kulliyye Şerhi, İstanbul 1327, p. 25).

Durak PUSMAZ

25 Is it permissible to sell alcoholic drinks to non-Muslims in Dar al-Harb?

There is no information about the issue in the fiqh books that are available but there are similar fatwas and views. For, transportation was not so common in the past.

We will mention some fatwas that will shed light on the issue:

If a person hires someone to carry wine,the money the person earns through carrying wine is halal according to Abu Hanifa but it is not permissible according to Imam Muhammad and Imam Abu Yusuf.If a non-Muslim from the People of the Book hires the animal or ship of a Muslim in order to carry wine, the money the Muslim gets is halal according to Abu Hanifa but it is not permissible according to Imam Muhammad and Imam Abu Yusuf.

Although it is not seen in practice, the following fatwa exists in fiqh books:

A Muslim can get money for herding pigs. This is the view of Abu Hanifa; it is not permissible according to Imam Muhammad and Imam Abu Yusuf. (2)

However, it is necessary to take various aspects of the issue into consideration:

It is more important for the Muslims living abroad to practice Islamic ethics in their social relationships than the Muslims living in an Islamic country. For, the non-Muslims living abroad see Islam directly in the lifestyle of Muslims and the high ethics of Muslims can be a means of guidance for non-Muslims.

Badiuzzaman Said Nursi says, "If we can serve as models by practicing Islamic ethics, the members of other religions can become Muslims in groups." Thus, he points out that a person will be held responsible if he does not represent Islam truly. 

Islamic fiqh scholars define non-Muslim countries as “darulharb”; they put forward different views related to the arrangement of relationships between Muslims living in those countries and non-Muslims. 

It is permissible for a Muslim to receive interest from a non-Muslim, to sell non-Muslim alcoholic drinks and pork, to gamble if it is certain that he will win according to Abu Hanifa and Imam Muhammad because those deeds are legitimate according to non-Muslims and because it can be justified for a Muslim to benefit from this legitimacy based on the decrees about booty; however, according to the majority of fiqh scholars including Imam Shafii, Imam Malik, Imam Ahmad bin Hanbal, Awzai, Ishaq and the Hanafi scholar Abu Yusuf, a Muslim has to act in accordance with Islamic decrees no matter where he is; therefore, they do not regard such wrong contracts and transactions permissible. 

The most appropriate one is this view of the majority.

For, the countries of the world including Islamic countries live based on the state of a general peace. Muslims can enter non-Muslim countries by permission and live in those countries in safety and security. The state of war is not in question. Therefore, the conditions that Abu Hanifa bases his fatwa on are not in question today. There is no war; therefore, there will be no booty in question.

In fact, the Quran and Sunnah do not allow haram things unless there is an obligation. Haram is haram anywhere unless there is an obligation.

To sum up, we can state the following:

"Today, Muslims have to live based on Islamic decrees and ethics no matter where they are. A deal/transaction that is not permissible between two Muslims is not appropriate between a Muslim and a non-Muslim either."

"Therefore, the Muslim living in non-Muslim countries must not receive interest and must not sell anything that is rendered haram by Islam like alcoholic drinks, pork and carrion (unless there is an obligation).” The view of the majority of the scholars that is away from doubts is like that.

However, when the fatwas above are taken into consideration, it can be said that it is permissible to get money by carrying alcoholic drinks and pigs according to Abu Hanifa but it is haram, not permissible, according to Imam Muhammad and Imam Abu Yusuf, and other mujtahids.  

A Muslim must not work in such places unless he is obliged to.

Footnotes:

1. Bukhari, Buyu: 102; Muslim, Musaqat: 71; Tirmidhi, Buyu: 60; Ibn Majah, Tijarat: 11.
2. al-Fatawal-Hindiyya, 4:449-450.
3. Mehmed Paksu, Meseleler ve Çözümleri 1, Nesil Publications, İstanbul, pp. 135-138; Süleyman Kösemene, Günümüz Meselelerine Çözümler , Yeni Asya Publications.

26 Is it permissible to buy and sell foreign currency?

It is permissible to buy and sell foreign currency. However, both parties must pay cash.

(see Halil GÜNENÇ, Günümüz Meselelerine Fetvalar, 1/422)