in the city of Riyadh, from 11 Jumada al-Ula 1402 AH to the 22nd of the same month, to review the letter of His Eminence Shaykh Ahmad ibn ʿAbd al-ʿAziz al-Mubarak, Chief Judge of the Sharia Courts in the United Arab Emirates, addressed to the venerable Chairman of the Supreme Judicial Council under ref. no. M/Sh 2006/1981 dated 6/2/1401 AH. In that letter he asks for a ruling on a partnership in which the citizen lends only his name to a foreign company and in return receives a percentage of the profit or a portion of it. He writes:
“Some governments have lately enacted laws prohibiting foreign companies operating on their territory from doing so unless they have a local partner. As a result, these companies conclude agreements with citizens in exchange for a fixed sum or a share of the profit, even though the citizen provides no capital and performs no work in these companies. It is clear to Your Eminence that, to the best of my knowledge, this kind of partnership has no basis in the principles of the Sharia.
We therefore request your guidance on this matter. Perhaps you have come across an earlier scholarly opinion on it, or the issue has been presented to you and you have already issued a fatwa.”
The Chairman of the Supreme Judicial Council referred the inquiry to the General Secretariat of the Council of Senior Scholars under letter no. 1087/1 dated 17/6/1401 AH so that it might be placed before the Council.
When the Council reviewed the study prepared by the Permanent Committee for Scholarly Research and Fatwa on the subject, and considered the form of partnership mentioned in the query, it concluded that this arrangement does not fall under the kinds of partnerships that many jurists regard as permissible. The ʿinān partnership (general partnership), upon which the jurists agree, must involve capital and labour from both parties or capital from both with labour contributed by one of them; yet in the partnership under discussion the citizen partner provides neither capital nor labour, and the same is the case with