Multi-level Marketing (MLM)

Answered according to Hanafi Fiqh by DaruliftaaZambia.com

Question

Am a graduate, but the offers i get is joining network marketing companies. Is dealing in such companies permissible, examples are jamalife, longrich tupperware, oriflame and the others?

 

Answer

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

Network marketing, also known as Multi-Level Marketing (MLM), is a business model where independent contractors buy into a company and earn a commission on the products they sell.

A Distributor can earn compensation in two fundamental ways: [i]

(1) Through retail mark-ups on sales of products purchased at wholesale prices;

Distributors can buy products from the Company at wholesale prices for resale to customers or for personal consumption.

(2) Through commissions (sometimes called bonuses) paid on one’s product sales and the sales of other Distributors in one’s downline sales network.

 

Shariah Ruling:

(1) It is permissible to purchase the products on a wholesale price without any conditions stipulated and sell it later at a retail price as long as the products are Halaal. [ii]

(2) Pyramid schemes in most cases are based on impermissible elements such as gambling, interest, ambiguity, deception and conditional sales. Hence, the transaction itself will be based on the contract. We are not in the position to comment on the second type of compensation, as we do not have sufficient information regarding it.

You may obtain the terms and conditions from the particular Network Marketing Company and refer to us for an Islamic ruling on the scheme.

 

And Allah Ta’āla Knows Best

 

Mufti Muhammad I.V Patel

 

Checked and Approved by

Mufti Nabeel Valli.

Darul Iftaa Mahmudiyyah

Lusaka, Zambia

 

www.daruliftaazambia.com

____________________

 

[i] https://www.nuskin.com/global/library/pdf/distearnings.pdf

 

فقه البيوع الجلد ٢ الصفحة ٧٧٥ [ii]

إن كان الدخول في شبكة التسويق غير مشروط في بيع المنتج، واقتصر المشتري على شراء المنتج فقط، ولم يدخل في شبكة التسويق، فهو شراء جائز، إذا استوفی شرائط جواز البيع، ومنها أن بكون المبيع حلالا

 

جدید فقہی مباحث جلد ١٣  صفحہ  ٥٠٦

 

کتاب النوازل جلد١ ١ صفحہ١٣٥

 

محقق و مدلل جدید مسائل جلد ١ صفحہ ٣٦٥

آج کل نیٹ ورک مارکیٹنگ یا ملٹی لیول مارکیٹنگ (Multi Level Marketing) کے نام سے مشہور تجارتی شکلیں وجود پذیر ہوچکی ہیں ،یہ اسلامی نقطۂ نظر سے ناجائز ہے اس لیے کہ یہ قمار کے زمرے میں داخل ہے

 

 


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