In the Name of Allāh,

the Entirely Merciful, the Especially Merciful

Praise is due to Allāh, Lord of the worlds, may the blessings and peace be upon our master Muḥammad, the last of prophets, on his family, and all his companions.

Resolution No. 46 (8/5) Limitation of Traders’ Profits

The Council of the International Islamic Fiqh Academy of the Organization of the Islamic Conference, holding its 5th session in Kuwait City, State of Kuwait, on 1–6 Jumādā al-Ūlā 1409h (10–15 December 1988),

Having examined the research papers of the Academy’s members and experts concerning the Limitation of Traders’ Profits,

Having listened to the discussions on the subject,

Resolves

First: The fundamental principle established by Shariah sources and maxims is that people should be free to buy and sell and dispose of their possessions and money, within the framework of the Shariah rulings, in accordance with the divine command: «O you who have believed, do not consume one another’s wealth unjustly but only [in lawful] business by mutual consent…» (al-Nisāʾ, 29) Second: There is no restriction to the profit percentage which trader can make in his transactions. It is generally left to the business environment, to the circumstances of the trader, and to the nature of the goods. However, the ethics recommended by Shariah, such as leniency, contention, empathy and

indulgence, should be taken into account.

Third: Shariah texts have spelt out the obligation to keep the transactions away from illicit acts like fraud, cheating, deceit, forgery, concealment of actual benefits, monopoly, which are detrimental to humans and society.

Fourth: Governments should not be involved in price fixing except when there are obvious market and price pitfalls due to artificial excuses. In this case, the government should intervene by applying adequate means to eliminate these factors, causes of defects, excessive price increases and frauds.

Indeed, Allāh is All-Knowing.