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Title: A study on Bayʻ al-Murābaḥa in Islamic law and its application in Malaysian Islamic banks
Author: Mohd Yusof, Suhaimi
ISNI:       0000 0004 9353 6700
Awarding Body: University of Aberdeen
Current Institution: University of Aberdeen
Date of Award: 2017
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Bay' al-murābaḥa (mark-up sale) is the concept of a sale contract in mu'āmalāt transactions and its application is considered by the Islamic banks as permissible. However, suspicion on the implementation of certain types of sale contracts by the Islamic banks violate the rules of sale contracts in Sharī'a law, which has made the murābaḥa concept controversial. It is accused of being used to sell something without a prior acquisition of possession, the simultaneous sale and buyback that involves no actual asset transfer and the selling of something that does not exist, in which in one way or another involves gharār (uncertainty), or/and ḥiyal (stratagems) or ribā (usury). Due to such controversy, Sharī'a scholars have reviewed some of the rulings related to the aforementioned concepts in order to ensure they comply with the Islamic Sharī'a. As a result of this review, tawarruq and bay al-'īna have been banned by the majority of Sharī'a scholars. The remaining two concepts are still under close scrutiny, although some Islamic finance experts are considered non-Sharī'a compliant. Therefore, this thesis aims to address this problem by examining the classical theory of bay' al-murābaḥa and its feasibility in its application in modern Islamic banking businesses. It also seeks to critically analyse modern jurists' arguments regarding two-tier murābaḥa and investigate the issues through a practical application of murābaḥa in Malaysian Islamic banks. The finding of this thesis confirmed that the current practice of murābaḥa failed to meet the principal objective of a sale contract, which is considered fundamental in order to comply with Sharī'a law. Hence, the need to rectify the current practice of murābaḥa to meet the principal objective of a contract is crucial to resolve non-Sharī'a compliant elements that potentially affect the whole system of the Islamic banking business.
Supervisor: Not available Sponsor: Government of Malaysia ; Bank Negara Malaysia
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available
Keywords: Mura¯bah?ah ; Financial institutions ; Banks and banking ; Islamic law