Journal of Business Law and Ethics

Șukūk al-Muḍārabah and Application of Third-Party Guarantee
Chaibou Issoufou, Umar A. Oseni

Abstract
This paper explores importance of ?ukuk al-Mu?arabah in Islamic capital movement and its suitability for financing projects which individuals are not able to provide capital for them. ?ukuk al-Mu?arabah is the most popular ?ukuk in ?ukuk market which has been structured to provide funds for the big projects which need huge amount of capital. This paper analyses the nature, salient features, and the process of ?ukuk al-Mu?arabah. The paper uses qualitative methodology which isbased on the four prominent schools of fiqh and some contemporary scholars. The paper examines to what extent the permissibility of third party guarantee in ?ukuk al-Mu?arabah process due to the crucial role that this guarantee plays in protection of ?ukuk transaction which exposes to risk transaction. It was found in this paper that application of third party guarantee is permissible in the ?ukuk al-Mu?arabah process if it is done without charging a fee.

Full Text: PDF DOI: 10.15640/jble.v4n1a2