Applications of decreasing partnership (al-mushārakah al-mutanāqiÎah) in Islamic banking: Some relevant Shari‘ah aspects

Sadique, Muhammad Abdurrahman (2012) Applications of decreasing partnership (al-mushārakah al-mutanāqiÎah) in Islamic banking: Some relevant Shari‘ah aspects. IIUM Law Journal, 20 (1). pp. 1-27. ISSN 0128-2530

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Abstract

Decreasing partnership based modes could be adopted with advantage for financing asset procurement as well as projects in a variety of situations. The shari‘ah admissibility of this mode essentially depends on the reality and independent functioning of the various contracts. Diverse capacities the parties undertake through the component contracts should be effectively reflected, especially through fulfilling the duties pertaining to ownership and lease, and accepting the liabilities involved. Gaining legal recognition for the component contracts should be attempted for. In decreasing partnership for ventures, the equity structure should not be based on terms favourable to one party alone. Replacing the legally binding promise to purchase with an understanding to that effect, giving the partners a choice in the matter, could be more conducive towards the equity relationship.

Item Type:	Article (Journal)
Additional Information:	5640/27212
Subjects:	H Social Sciences > HG Finance > HG1501 Banking H Social Sciences > HG Finance > HG4001 Financial management. Business finance. Corporation finance. K Law > KBP Islamic Law > KBP1 Islamic law.Shariah.Fiqh > KBP490 Furūʻ al-fiqh. Substantive law. Branches of law. > KBP639 Muʻāmalāt
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Ahmad Ibrahim Kulliyyah of Laws > Department of Islamic Law
Depositing User:	Dr Muhammad Abdurrahman Sadique
Date Deposited:	03 Dec 2012 14:42
Last Modified:	10 Apr 2013 13:14
URI:	http://irep.iium.edu.my/id/eprint/27212

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