ISLAMIC ESTATE PLANNING: ANALYSING THE MALAYSIAN PERCEPTIONS ON WASIYYAH (WILL) AND BEQUEST PRACTICES

Islamic inheritance system is usually explained within the conceptual and mechanistic framework of faraid, bequest and gift (hibah). In Islam, there is no limitation on the transfers of wealth during the lifetime, but the disposal of estates upon the death is strictly subject to faraid and bequest rules. The salient feature of faraid implies that inheritance is subject to pre-determined quantum of shares of the eligible heirs. Bequest, on the other hand, is limited up to one-third of the estates value and only allowed to be given to the non-heirs. Considering Islamic estate planning and Islamic inheritance system within the same framework renders a new dimension as part of the Islamic economics and finance that calls an urgent investigation. Making a wasiyyah (will) is the most crucial part of such a system. In referring to the conflict of laws in defining the meaning and contents of wasiyyah, this study, however, selected wasiyyah which carries the meaning of a will and, secondly, bequest as the main concepts to research in this debate. The main aim of this research, thus, is to explore the perception of Malaysian Muslims towards wasiyyah and bequest from financial planning and economics points of view within the Islamic estate planning framework. Wasiyyah, hence, was analysed in terms of the Malaysian Muslims’ awareness and practice. Bequest, was examined in terms of their attitudes to leaving a bequest based on the life-cycle, altruism and dynasty bequest models with integration of the Islamic theory of wealth. This research further aims at analysing the perception of the wasiyyah writing providers with the objective of locating their opinions on various related issues. In responding to the research questions, primary data were collected through questionnaire with a sample of Malaysian Muslims to identify the demand side related issues, while semi-structured interview schedule used to assemble data from wasiyyah writing providers representing the supply side of the practice. In analysing the data, multiple analysis techniques were employed. In investigating the wasiyyah related issues, descriptive statistics, mean value and chi-square were used. Findings imply that the awareness level of wasiyyah was low reflecting their inadequate exposure of the wasiyyah ruling, professional means of wasiyyah writing and the importance of wasiyyah in estate planning. Thus, wasiyyah practice was a minority activity. Other findings reflect making a wasiyyah by means of traditional methods either handwritten by themselves or verbal wasiyyah were common practices, but, Malaysian people have gradually accepted the professional means of making a wasiyyah especially with ARB due to its credibility and its status as a government institution. Several factors were identified to be significant to the wasiyyah practice namely age, employment status, monthly income, amount of inheritance received previously, health status, having children, having adopted children, having grandchildren, knowledge, institutional factor and inheritance law. Other findings show that mass media were the main sources of their knowledge and to increase their awareness. The study also found that there was a conflict of interest in wasiyyah writing providers in terms of increasing awareness, educating people and profit maximization. They also differed in their perception on the ability of wasiyyah alone solving the estate problem comprehensively and showing their concerns over the manipulation of several estate planning instruments to avoid faraid. Investigation on the attitudes to leaving a bequest using multinomial logit model implies that such attitudes were influenced by several factors namely age, ethnicity, education, having grandchildren, employment status, monthly income, total assets value, importance of bequest, religiosity and inheritance law. Bequest motives were also examined by cross checking the findings from the types of bequest, verbatim responses and results obtained from the multinomial logit. To sum up, life-cycle, altruism and dynasty model co-existed in their bequest making with some of them observed the Islamic theory of wealth. Other additional finding shows that people did not utilize the bequest allocation especially those who had non-Muslim family members

“I want to withdraw my hibah”: why and how to explain it?

Hibah or Islamic intervivos plays a vital role in reducing unclaimed inheritance estate problems, aiding recipients, and expecting recipients’ care. However, there are cases of withdrawn hibah that have been argued in the court. This study was performed to understand this problem by interviewing hibah experts in Malaysia. Thematic analysis was applied to find an overview of why donors withdraw their hibah by interviewing 19 respondents who are hibah experts in Malaysia. There were two main themes which were ‘Donor’s desire’ and ‘Recipient’s attitude.’ ‘Donor’s desire’ can be understood by the desire of donor to get benefits from the property that has been perfectly transferred or if the donor still resides on the property. Meanwhile, ‘Recipient’s attitude’ describes a change in recipients’ attitude such as ignoring and expelling the donors from the transferred property. The recipients also might sell the transferred property. This reason leads to donors wanting to withdraw their hibah. This study’s findings recommend that absolute hibah needs to be replaced with hibah legal documentation or living trust. These types of hibah are recognized by Sharī‘ah and Civil law and enable the donors to withdraw their hibah during lifetime. This study is the first attempt to discuss profoundly withdrawn hibah in qualitative approach. The paper offers an additional study on hibah practice in Malaysia

Searching for bequest motives and attitudes to leaving a bequest among Malaysian Muslims

This study aims to identify bequest motives and investigate the attitudes to leaving a bequest among malaysian Muslims.Data are collected by means of questionnaire and analysed with multinomial logit model.Results from this model are compared with the verbatim responses given by respondents. Evidences suggest to co-existences of various bequest motives with no preference in order, namely pure life-cycle,life-cycle with some strategic or exchange features.altruistic and dynastic bequest models. However, the domination of one particular bequest motive over others is solved via analaysis carried out on the verbatim responses

Legislative provisions for waṣiyyah wājibah in Malaysia and Indonesia: to what extent do they differ in practice?

Purpose: This research aims to examine and compare differences in waṣiyyah wājibah (obligatory bequest) (WW) practices in Malaysia and Indonesia. Design/methodology/approach: This is an exploratory qualitative research, employing a thematic analysis approach. Six Muslim Wills (State) Enactments [Enakmen Wasiat Orang Islam (Negeri)] in Malaysia, Islamic Law Compilation (Kompilasi Hukum Islam) in Indonesia, two fatwas (ruling in religious matters) and one court case from each country are analysed. Data is collected from official government websites and other reliable search engines. Findings: First, the findings show that the WW practice in both countries is similar regarding the quantum of the beneficiaries' entitlement. However, the practice varies between both countries in terms of the types of beneficiaries and how the bequest is distributed. Second, this study shows the potential of WW as an estate planning instrument to complement the existing instruments in each country, especially when addressing family members who are not entitled to succeed by farāʾiḍ (Islamic inheritance law). Practical implications: The provision of relevant laws and regulations regarding WW needs to be formulated to guarantee the well-being of dependants. The differences in practice between the two countries can be a guideline to expand the WW scope and context to other Muslim countries. Originality/value: This study is the first attempt to compare WW between two Muslim-majority countries focusing on relevant laws, court cases and regulations

Blue Waqf Framework for Blue Forest Sustainability: A Conceptual Framework

Blue forests are areas that protect the coastline from flooding and erosion. They harbor wildlife and provide a sustainable livelihood for communities. One of the blue forest types is mangrove forest. Indonesia has the most expansive mangrove forest area in Southeast Asia, but nearly 25% has been deforested. Maintaining the sustainability of mangrove forests is one of the sustainable development goals (SDG) 14. Therefore, to achieve this goal, financing is needed to support the needs in maintaining the sustainability of mangrove forests. This paper is a conceptual framework that provides an Islamic social finance-based funding model for the blue forest sector. This program is called Blue Waqf. In order to implement this program, Indonesian Waqf Board and registered nazir are needed as the program’s coordinators. In addition, a colossal campaign needs to be conducted. The involvement of the surrounding community as a social adaptor is also vital. Last, waqf management through blue waqf requires protection from takaful/project guarantees. It has to be done to minimize the economy. The impact will be sustainable for the economy, society, and the environment. The profits obtained from blue waqf will be distributed to beneficiaries. Keywords: Blue Waqf, sustainable, Blue Forest, conceptual framewor