Trading Shares halal or haram ?

[not known]

On the basis of your MBA class, you decide what is halaal or haraam? lol

Just kidding with you bro, but we have to be more careful- nowadays people think they have to get an MBA to know business, but in order to decide halal or haraam, they just need to have an opinion, not any study...

Some of my teachers of MBA are shariah adhering and careful in explaining the masail related to buziness along with studies

anyway I will again discuss this topic with them and provide the answer

p.s: It also helps in understanding an answer of 10 marks much better

Second question:

Mufti Ebrahim Desai brings the proof of shareholders not being owners of the company because they cannot jointly sell, destroy, etc. the assets of the company.

But I was under the impression that shareholders do have joint power over the assets of the company. In the US, at least there are annual shareholder meetings, and although it is a practical rarity, I think, any shareholder can submit proposals for company policy, change of directors, firing of CEO, etc. and if a majority vote for it, the company does do that thing.

So I thought that if all the shareholders decided to do whatever they wanted with the company assets, they actually could (as long as not illegal). Is this not the case?

only Equity share holders have the right to influence the decisions of the company. They can attend the company meetings too. Others can not make any influence

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[Rabbana]

May I ask one thing ?

What about buying and selling shares of Banks ? Bank shares like any other shares is dependent on the working and proit of company , and banks make their profit form shares...

So what about that ?

[abuhajira]

May I ask one thing ?

What about buying and selling shares of Banks ? Bank shares like any other shares is dependent on the working and proit of company , and banks make their profit form shares...

So what about that ?

Essentially a bank, any bank is a company. Buying shares in it is also like buying shares in other companies. Hence impermissible.

Perhaps you refer to buying and selling of shares themselves as a commodity. Then in that case once we categorize buying shares in a company itself as a loan, the shares themselves as a commodity will represent a receipt of a debt. Purchase and sale of loan is also impermissible by explicit ahadith.

[not known]

Essentially a bank, any bank is a company. Buying shares in it is also like buying shares in other companies. Hence impermissible.

Perhaps you refer to buying and selling of shares themselves as a commodity. Then in that case once we categorize buying shares in a company itself as a loan, the shares themselves as a commodity will represent a receipt of a debt. Purchase and sale of loan is also impermissible by explicit ahadith.

are u saying buying any type of shares is not permissible ?

my college didn't start yet because of tensions in Hyderabad, so i couldn't meet my professors still

edit: from ask imam i got that it is completely not permissible

[Rabbana]

so the CONCLUSION is : buying and selling shares are haram , right ?

[abuhajira]

yes that is what I feel too after reading the complete discussion from Mufti Desai..

[hope1]

yes that is what I feel too after reading the complete discussion from Mufti Desai..

Is Muft Ibrahim Desai saheb saying that buying a share is advancing a loan to the company? I think I read that somewhere. Is this true.

[abuhajira]

Is Muft Ibrahim Desai saheb saying that buying a share is advancing a loan to the company? I think I read that somewhere. Is this true.

in the document, read up on the very last (long) reply. you can skip the examples as they are all law cases to substantiate the premises of juristic person. Aside from that all the points are there to see that Mufti Saheb actually disagrees with the idea on multitudes of levels and not just one reason etc. With regards to the advancement in loan.. I mentioned that in post #14

[mffhere]

Second question:

Mufti Ebrahim Desai brings the proof of shareholders not being owners of the company because they cannot jointly sell, destroy, etc. the assets of the company.

But I was under the impression that shareholders do have joint power over the assets of the company. In the US, at least there are annual shareholder meetings, and although it is a practical rarity, I think, any shareholder can submit proposals for company policy, change of directors, firing of CEO, etc. and if a majority vote for it, the company does do that thing.

So I thought that if all the shareholders decided to do whatever they wanted with the company assets, they actually could (as long as not illegal). Is this not the case?

Asalamu Alaikum,

Normally the shareholders cannot do whatever they want with the assets of the company and even if majority shareholders are willing to for example gift a company owned vehicle to Mr. A, the management can object to it, as it is not in the best interests of the company (which is a separate legal entity than its shareholders)..

Although, I read of a possibility namely Unanimous Shareholder Agreement (USA) under the Canadian Business Corporation Act, which allows the shareholders such right, but it does not seem that it is normally in practice.

"..The Supreme Court of Canada has described the USA provision as:

providing a mechanism by which the shareholders, through a unanimous agreement, [can] strip the directors of some or all of their managerial powers as desired by the shareholders. Rather than removing the directors from their positions, a USA simply relieves them of their powers, rights, duties, and associated responsibilities. This may be accomplished without specific formality … . [W]hat is in effect created is an “incorporated partnership” with statutory force.."

ref.: http://www.parl.gc.ca/Content/LOP/Re.../prb9932-e.htm

Disclaimer: I follow the opinion of Mufti Ebrahim Desai db on this view and only finding answers to such queries (as by brother Meelash) to support my belief and to gain strong insight so that I am confident while explaining or discussing it with someone. If anything contrary to the fatawa of Mufti Sahab is found in my post(s) I would be glad that someone informs me so that I do edit it.

Wassalamu Alaikum