Islamic Commercial Law

Abstract

Introductory Remarks The Islamic law of transactions (mu'amalat) has often been singled out as the most important area of contemporary research in Islamic theses, so much so that, according to some observers, its priority is even higher than that of research in applied sciences and medicine. This status is due to the critical importance of commercial transactions in the wealth generation and productivity prospects of contemporary Muslim countries. New research on issues of conventional fiqh al mu'amalat is essential for the viability and success of economic development programs in Muslim countries. In recent decades, research interest in fiqh al mu'amalat has been shifting increasingly to specific themes and development of new operative formulas to stimulate profitable business in the marketplace. Evidently, futures trading is one such theme where original ijtihad is required to enhance the prospects of economic success, especially in farming and agro-based industries in developing Muslim countries. The futures market is where contracts for future sale and purchase can be concluded for standardized quantities and qualities of commodities, currencies, bonds, and stocks. Ever since the large-scale inception of futures markets in the early 1970s, new products and trading formulas in various trade sectors involving commodities, options, financial futures, and stock index futures, among others, have increased so much that futures contracts currently are available in over eighty commodities, ranging from food grains, oil and oil seeds, sugar, coffee, livestock, eggs, orange juice, cotton, rubber, precious metals, and currencies. In terms of volume, futures trading has far exceeded trading levels in conventional stocks and, currently, is the single most voluminous mode of commerce on the global scale ...