Rectification of Uqud Al-Fasidah (Void Contracts) in Islamic Financial Institutions
DOI:
https://doi.org/10.33102/jfatwa.vol20no1.4Keywords:
Shariah scholars, ijtihad, Islamic finance innovationsAbstract
Shariah compliance is the most critical element in the operations of Islamic financial institutions. In order to ensure the Shariah compliance, some samples of IFIs’ products are reviewed and audited. The audit practices has led to growing findings which reveal cases of uqud al-fasidah (void contracts) in IFIs. Thus, the articles discusses the issue by recommending several actions for IFIs in dealing with void contracts. The article highlights seven common causes of void contract related with bay’ al-tawarruq transaction. Some of the void instances can be rectifiable and some are non-rectifiable. As Shariah Non-Compliance (SNC) is treated seroiusly by IFIs and the regulators, the dicussion will provide insights on how to reduce the SNC incidences and to minimse their financial impatcs to relevant parties
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Copyright (c) 2020 Amir Husin Mohd Nor, Amir Shaharuddin, Mohamad Zaharuddin Zakaria, Ahmad Zaki Salleh, Mualimin Mohammad Sahid, Hussein 'Azeemi Abdullah Thaidi, Muhamad Firdaus Ab Rahman, Muhammad Ridhwan Ab. Aziz, Mohd Afiq Ab. Jalil
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