Contemporary Primary Sources :: Fatwās - Contemporary :: 24 Ṣafar 1427 / 23 March 2006
National Shari'a Board - Indonesian Council of Ulama Fatwa No. 50 of 2006 on Mudharabah Musytarakah Agreements
Dewan Syari'ah Nasional MUI, Posted by Daniel Peterson, 09 March 2016
This fatwa defines a mudharabah musytarakah as a type of mudharabah agreement where the shari'a financial institute funds manager (mudharib) uses its capital in a joint-venture investment with the customer. The provisions of such an agreement are:
- the agreement used is a mudharabah musytarakah agreement, that is, a combination of a mudharabah agreement and a musyarakah agreement;
- the shari'a financial institute, as a funds manager, uses its capital or funds in the investment with the customer;
- the shari'a financial institute, as a party to the agreement, uses its own funds to obtain a proportional profit;
- the parties share in the profit, after the shari'a financial institute has recouped its initial investment; and
- in the event of financial loss, the shari'a financial institute bears a loss proportionate to its investment.