Bay Urbun (Down Payment Sale)

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. 72 (3/8)

Bay Urbun (Down Payment Sale)

The Council of the International Islamic Fiqh Academy of the Organization of the Islamic Conference, holding its 8th session in Bandar Seri Begawan, Brunei Darussalam, on 1–7 Muḥarram 1414h (21–27 June 1993),

Having examined the research papers submitted to the Academy concerning

Bay Urbun (Down Payment Sale),

Having listened to the discussions on the subject above,

Resolves

  1. Down-payment (earnest) sale means the sale of a commodity with the buyer making a down-payment to the seller on the understanding that if he took the commodity the down-payment would be deducted from the selling price, and if he dropped it then the down-payment would be the seller’s

It is subject to the same rulings as in service contracts for it is considered as the sale of a service. Exceptions are made in the case of sales whose validity is made subject to the reception of either of the exchange’s two elements (as in Bay Salam), and in the case of sales whose validity is subject to the spot reception of the exchange’s two elements (as in trades including usury money or currency exchange). However, it does not ap- ply to the case of Murābaḥah to the purchase orderer at the stage of mu- tual promises, it is rather done at the stage of selling subsequent to the contract.

  1. Down-payment sales are permissible if the time frame of the contract is set, and the down payment is considered part of the selling price if the purchase is carried out, and it shall be a righ property to the seller if the buyer

Indeed, Allāh is All-Knowing.

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