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Basic Fiqh of Trade

Answered as per Shafi'i Fiqh by Qibla.com

Answered by Shaykh Amjad Rasheed

What are the most important rulings that must be observed when buying and selling?

In the Name of Allah, Most Gracious, Most Merciful

Conditions of a Valid Sale

First of all, it is obligatory to know the conditions of a valid sale. In our school, these are six:

1. The spoken offer and acceptance. A sale conducted without a spoken offer and acceptance (mu‘atah) is therefore invalid in our school, although it is permissible to follow those who hold that it is permissible [h: such as the Hanafis]. Some of our [h: Shafi‘i] Imams have also chosen this position [h: cf. Reliance k1.1 for further detail].

2. The merchandise must be pure. It is therefore invalid to transact something that is impure (such as a dog), although it is permissible to relinquish one’s right (raf‘ al-yad) over it in exchange for something, [h: provided that this is done] without the wording of a sale (bay‘).

3. The merchandise must be useful. It is therefore invalid, for example, to transact musical instruments, since they are not considered useful from the perspective of Islamic Law and it is forbidden to use them.

4. The seller must own the merchandise. It is therefore invalid [h: for him] to transact something that he does not own.

5. The merchandise must be known. It is therefore invalid to transact something that is unknown in a manner that leads to dispute.

6. The merchandise must be deliverable. It is therefore invalid, for example, to transact something that a third party has wrongfully appropriated when [h: the seller] is unable to take it back from him.


The seller should also beware of deception (ghishsh), which occurs when the owner of the merchandise knows something about [h: the merchandise that the buyer does not know] which, if the buyer knew it, he wouldn’t take [h: the merchandise] for the same price. It is obligatory for [h: the seller] to inform [h: the buyer] of it so that he takes [h: the merchandise] in full knowledge, as Shaykh Ibn Hajar said in al-Zawajir (1.517) in the section on the 200th major sin. The seller should also beware of swearing false oaths to promote his merchandise.

Usurious Gain

He should also beware of usurious gain (riba), such as taking more than what he sells if what is bought and sold is of the same type (jins), such as gold for gold, silver for silver, dollar for dollar, or pound for pound. An example of this is what sometimes occurs with money-changers: when someone wants to change $100 in ten-dollar bills for a $100 in a single hundred-dollar bill, they charge a certain amount of money for this; this is usurious gain.

Another type of usurious gain is to delay payment when two things that are exchanged have the same cause [h: for being classified as things on which usurious gain applies], such as gold and silver, and dollars and pounds. When such things are exchanged, it is obligatory that they both be taken possession of before the buyer and seller part company; delaying it is usurious gain. It is, however, permissible in this case to [h: give] more [h: of one thing than the other; e.g., to exchange gold for silver, but in different quantities] because the type (jins) is different. An example of such a delay occurs when, for example, gold or silver jewelry is sold for dollars on deferred payment: this is usurious gain. It is obligatory that both things being exchanged be taken possession of before the [h: buyer and seller] part company.

These are some of the most important things that one must know if one wants to buy or sell, although certain details and other rulings to do with trade remain [h: unmentioned] that someone who wants to enter into buying and selling must know. [h: Such a person] should minimally read a book about this topic and ask those of knowledge whenever he encounters something that he does not know the ruling of.

And Allah alone grants success. O Allah! Suffice us through your halal from your haram, and free us of need through your bounty from everything else.

This answer was indexed from Qibla.com, which used to have a repository of Islamic Q&A answered by various scholars. The website is no longer in existence. It has now been transformed into a learning portal with paid Islamic course offering under the brand of Kiflayn.

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