Fixed Interest Condition in Banking Civil Partnership Contracts
Subject Areas : Civil Law
Keywords: Civil Partnership, Islamic Jurisprudence, Fixed Profit, Partnership ,
Abstract :
Civil partnership is the most widely used form of partnership contract in Iran’s banking system. Among the terms embedded within this contract is the stipulation of a fixed profit, a provision that has consistently provoked debate due to its perceived conflict with the Islamic prohibition of usury (riba). This study seeks to address the issue through a structured, library-based approach, presented in four main sections: introduction, general principles, the condition of profit and loss, and critiques with proposed solutions. Islamic jurists have not reached a consensus on this matter; while most uphold the validity of the contract itself, they regard the fixed profit stipulation as invalid. Based on the findings, it appears that such provisions, when included in civil partnership contracts within the banking sector, necessitate substantial legal and regulatory reform. Nonetheless, similar conditions may be considered valid in certain other partnership and non-partnership contracts.
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