The enforceability of Wa‘d Mulzim (Binding Promise) from a fiqh perspective: A critical analysis of wa‘d application in sukūk contracts

Wa‘d (promise) is a concept that is frequently applied in various Islamic financial products. Although this concept has been used widely in Islamic financial products, as a result of the arising Sharī‘ah issues, wa‘d especially wa‘d mulzim (binding promise) in some contemporary practices towards contracts of Islamic financial products, remains a debatable practice among some Sharī‘ah scholars. This research aims to analyse some Sharī‘ah issues pertaining to the application of the wa‘d mulzim in the Islamic finance industry, especially the issue of wa‘d mulzim in sukūk contracts, particularly in partnership-based contracts which are sukūk muḍārabah, and sukūk mushārakah concepts. Two aspects are particularly emphasized. First, wa‘d can be binding in certain conditions, but to legally enforce this concept, there remain disputes and controversial discussions among scholars. Second, this study also discusses the issues of “promise to buy” or “promise to sell” (the asset) at a certain “price” i.e. the price at the same nominal value at which the bond was issued. Hence, this research will try to analyse the opinions of the scholars, certain related fatwas, Sharī‘ah resolutions and guidelines to understand the applicability of the binding promise towards Islamic financial products and ensure that the application of the binding promise is in line with the Sharī‘ah requirements

Issues of Bai’ al-‘Inah in the contemporary Islamic financial products and its solutions according to the shariah principles

Bai’ al-‘inah is one of the well-known sale-based contracts among Islamic financial products. This type of contract has been applied by most of the Islamic Financial Institutions (IFI) particularly in Malaysia towards their Islamic financial products.Although all the controversial issues related to bai’ al-‘inah have already been discussed before by Fiqh scholars, due to the implementation of the underlying Shariah concept of Bai’ Al-‘Inah in current Islamic financial products, it appears that new issues relating to ‘inah have appeared and need to be deliberated further by contemporary Islamic scholars to ensure that it is in line with the development of Islamic financial products. One of the main Shariah issues that has occurred in bai’ al-‘inah based contracts is the sequence of the implementation of the aqad (contract) between the bank and the customers. Hence, this research will focus on this issue from several points of view, which include the causes that lead to the issue, the best solutions according to the Shariah to rectify the issue, and the consequences of the affected accounts if the issue is a Shariah compliance issue. Besides that, this research also will try to explore the solutions and decisions from the Shariah Committees of some of the Islamic banks in Malaysia. Thus, this research will try to briefly state the decisions of the three banks that operate Islamic bank licenses, which are AmIslamic Bank, Bank Simpanan Nasional and Agro Bank. In order to focus on the main issue of this research, which is the sequence of aqad, the researcher will also try to explore that issue in some of the Islamic products that apply bai’ al-‘inah as the underlying Shariah contracts, mainly on personal financing and home financing

The Enforceability of Wa‘d Mulzim (Binding Promise) from a Fiqh Perspective: A Critical Analysis of Wa‘d Application in Sukūk Contracts: قابلية التنفيذ للوعد الملزم في ضوء الفقه الإسلامي: دراسة تحليلية نقدية لتطبيقات الوعد في عقود الصكوك

من المسائل التي يكثر تطبيقها في المنتجات المالية الإسلامية الوعد والمواعدة. ومع كثرة تطبيقه في هذه المنتجات فلا يزال هذا الموضوع موضع الخلاف بين بعض الفقهاء فيما يتعلق بالوعد الملزم في تطبيقاته المعاصرة في عقود المنتجات المالية المطبقة حاليا. تهدف هذه الدراسة إلى تحليل بعض المسائل المتعلقة بتطبيق الوعد الملزم في المؤسسات المالية الإسلامية، وعلى وجه الخصوص في صكوك المضاربة وصكوك المشاركة. وثمة موضوعان تركز عليهما هذه الدراسة، فأولهما أن الوعد يكون ملزما ببعض الشروط، غير أن جعله ملزما قانونيا فهذا لا يزال الاختلاف فيه قائما بين العلماء. والثاني أن هذه الدراسة أيضا تناقش قضية الوعد على الشراء أو الوعد على البيع بثمن معين مثل الثمن الرمزي الذي به صدر السند المالي. وعليه، فإن هذه الدراسة تسعى إلى تحليل آراء العلماء في هذه المسألة وبعض الفتاوى والقرارات والإرشادات الشرعية المتعلقة بها لأجل فهم قابلية تنفيذ الوعد الملزم في المنتجات المالية الإسلامية والتحقق من موافقته مع المتطلبات الشرعية. الكلمات المفتاحية: الوعد، الصكوك، المضاربة، المشاركة، الفقهWa‘d (promise) is a concept that is frequently applied in various Islamic financial products.  Although this concept has been used widely in Islamic financial products, as a result of the arising Sharī‘ah issues, wa‘d especially wa‘d mulzim (binding promise) in some contemporary practices towards contracts of Islamic financial products, remains a debatable practice among some Sharī‘ah scholars. This research aims to analyse some Sharī‘ah issues pertaining to the application of the wa‘d mulzim in the Islamic finance industry, especially the issue of wa‘d mulzim in sukūk contracts, particularly in partnership-based contracts which are sukūk muḍārabah, and sukūk mushārakah concepts. Two aspects are particularly emphasized. First, wa‘d can be binding in certain conditions, but to legally enforce this concept, there remain disputes and controversial discussions among scholars. Second, this study also discusses the issues of “promise to buy” or “promise to sell” (the asset) at a certain “price” i.e. the price at the same nominal value at which the bond was issued. Hence, this research will try to analyse the opinions of the scholars, certain related fatwas, Sharī‘ah resolutions and guidelines to understand the applicability of the binding promise towards Islamic financial products and ensure that the application of the binding promise is in line with the Sharī‘ah requirements. Keywords: Wa‘d, Sukūk, Muḍārabah, Mushārakah, Fiqh https://doi.org/10.31221/osf.io/3dbc