this, too, contravenes the Sharia rulings that govern lawful partnerships, for it involves excessive uncertainty and exposes the company to harm. Even if one were to award him a specified, undivided share of the profit while exempting him from any share of the loss, such a payment would be unjustified, since he has furnished neither capital nor labour; the arrangement is fraught with ambiguity and injury.

Objection: All transactions are presumed permissible by default.

Response: That presumption stands only so long as no contravention of Sharia principles is established. In this particular partnership the elements of harm, deception, falsehood, forgery, disobedience to the ruler’s lawful directives and benevolent aims, and the pursuit of illicit gain all displace the ruling from permissibility to prohibition and invalidate the contract.

Accordingly, the Council rules that this partnership contract is invalid and that Muslims must refrain from engaging in it, limiting themselves instead to companies and contracts that are permitted under Islamic law. Allah alone grants success.

May blessings and peace be upon His servant and Messenger Muhammad, and upon his family and all his Companions.

Council of Senior Scholars