Section on Sales and the Various Forms of Transactions

1 – Allah the Exalted says, “Allah has permitted trade and forbidden usury” [Al-Baqarah 2:275]; He also says, “Believers, do not consume usury, doubled and multiplied” [Āl-ʿImrān 3:130]; and, “Believers, do not devour one another’s wealth unjustly, but rather conduct trade by mutual consent” [An-Nisāʾ 4:29]; and, “Believers, when you contract a debt for a specified term, put it in writing … and be mindful of Allah; Allah teaches you, and Allah has full knowledge of everything” [Al-Baqarah 2:282].

• These noble verses encompass many rulings and important benefits, among them the principle that all forms of sale, transactions, and commercial dealings are, by default, permissible and unrestricted, as the wording of the verses clearly indicates.

• No distinction is made between brokerage-style trade managed among merchants, where one party receives the payment and another delivers the commodity.

• Nor is there a distinction with trade involving debts whose price is paid on the spot while the merchandise is deferred, such as a salam contract (1), or with the sale of goods for deferred prices, because of the general statement, “When you contract a debt …” [Al-Baqarah 2:282].

• Nor is there any distinction with speculative or anticipatory trade, whereby a person buys goods when prices are low and waits for opportune seasons or other occasions before selling.