THE FIQH CHARACTERIZATION OF IJĀRAH MAWṢŪFAH FĪ AL-DHIMMAH: AN ANALYSIS OF JURISTIC VIEWS

The application of the Shari’ah principle of ijarah mawsufah fi al-dhimmah (forward lease) can be traced back to the early days of Islam. It is derived from the original contract of ijarah (lease), which has been widely used in the structuring of Islamic financial transactions to cater for various Muslim and non-Muslim needs over time. Thus, the classical books of Islamic jurisprudence have amply discussed its applications in various forms according to the prevailing circumstances.

Today, ijarah mawsufah fi al-dhimmah is applied in the offering of various services in the Islamic finance industry relating to education, medical treatment, tourisın, hajj and umrah, among others. Nevertheless, its applications involve a number of Shari’ah issues concerning the advance rental payment, the subject matter of the contract and its fiqh characterization. The primary purpose of this paper is accordingly to examine the key Shari’ah issues arising in the current applications of ijarah mawsüfah fi al-dhimmah in the Islamic finance industry and to determine their juristic stance. Since ijarah mawsüfah fi al-dhimmah shares the characteristics of both ijärah and salam (forward sale), this paper also aims to examine the most relevant contract applicable in ijarah mawşüfah fi al-dhimmah.