This excerpt is taken from Dr. Yusuf al-Qaradawi's book Halal and Haram in Islam, translated into Urdu by Muhammad Tahir Naqqash.
Manipulating Prices
Islam prefers to leave the market free so that natural laws continue to operate. Prices will fluctuate in the market according to the supply and demand of goods. This is why we see that during the time of the Prophet, when prices rose and people said: O Messenger of Allah, set prices for us, the Prophet (peace be upon him) said:
إن الله هو المسعر القابض الباسط الرازق وإنى لارجو ان القى الله وليس احد منكم يطالبني بمظلمة فى دم ولا مال
"Allah alone is the one who sets prices. He causes inflation and deflation, and He is the provider of sustenance. I want to meet Allah while none of you has any claim against me regarding blood or wealth."
Reference: Musnad Ahmad: 3/156, 286; Abu Dawood, Kitab al-Ijarah, Bab fi al-Tas'een, Hadith: 1314; Tirmidhi, Kitab al-Buyu', Bab ma ja'a fi al-Tas'ir, Hadith: 1314; Ibn Majah, Kitab al-Tijarat, Bab man kariha an yus'ir, Hadith: 2200; Sunan al-Darimi: 2/1249
Through this hadith, the Prophet of Islam declared that unnecessary interference in individual freedom is oppression. However, if unnatural factors enter the market, such as hoarding and manipulating prices, then in such cases, the collective interest should be prioritized over individual freedom. In such situations, setting prices is a social necessity to protect society from greedy profiteers.
همارے زمانه ميں جس كي لاٹهي اس كي بهينس والا معامله هو چكا هے، كيونكه اشياء خوردني وافر هوتے هوئے بهي ذخيره اندوز قيمتوں ميں بڑهوتي كي غرض سے صاحب حل و عقد خود ملكي معيشت پر گنجے سانپ كي طرح قابض هيں جب چاهتے اور جيسے چاهتے كرتے هيں كوئي اجتماعي پاليسي نهيں. (اداره)
The meaning of the mentioned hadith is not that setting prices is forbidden in all cases, even if it is done to remove hardship or prevent clear oppression. Rather, learned scholars accept that setting prices is forbidden and oppressive in some circumstances but is fair and permissible in others. Therefore, if people are forced by unjust means to sell goods at prices they do not agree to, or if they are prevented from selling permissible items, this will be forbidden. And if prices are set to establish justice among people, for example, compelling them to sell at a standard price or prohibiting charging more than the known price, then doing so is not only permissible but obligatory.
The first case is addressed by the mentioned hadith. So when people sell goods in the customary way without oppression, and prices rise due to scarcity or population increase, the matter should be left to Allah. Forcing people to sell goods at a fixed price in such a case would be an unjust form of oppression.
As for the second case, when traders do not sell goods despite the needs of the people and demand prices higher than the customary and social price, then selling goods at the prevailing price becomes obligatory, and setting prices means imposing the prevailing price on them. At such a time, determining prices means compelling traders to adhere to the justice that Allah has made obligatory.
Reference: See: Risalat al-Hisbah by Ibn Taymiyyah (may Allah have mercy on him) - and Al-Turuq al-Hukmiyyah by Ibn Qayyim (may Allah have mercy on him) - p. 214
The Hoarder is Cursed
Although Islam grants individuals and society the freedom of buying and selling and natural competition, it strongly denies that people, driven by selfishness and greed, keep accumulating wealth excessively, even if that wealth is amassed through food grains and other essential commodities of the nation. Therefore, the Prophet ﷺ strictly forbade hoarding and said:
من احتكر الطعام أربعين ليلة فقد برئ من الله وبرئ الله منه
"Whoever withholds grain for forty days, Allah disowns him."
Reference: Musnad Ahmad: 2/33 - Mustadrak Hakim: 2/11
And He said:
لا يحتكر إلا خاطئ
"The hoarder is a sinner."
Reference: Muslim, Book of Transactions, Chapter on the Prohibition of Monopoly in Food, Hadith: 1605
The Prophet ﷺ described the psychology of a hoarder as follows:
بئس العبد المحتكر إن سمع برخص ساءه وإن سمع بغلاء فرح
"Very bad is the person who hoards. When prices fall, he feels bad, and when prices rise, he becomes happy."
Reference: Majma' al-Zawa'id: vol. 4/101, citing Tabarani in al-Kabir: 20/95, also narrated in Musnad al-Shamiyyin: 412 and Ibn 'Adi in al-Kamil: 2/530, though its chain is weak
He also said:
الجالب مرزوق والمحتكر ملعون
"The one who brings goods to the market is provided sustenance, and the hoarder is cursed."
Reference: Ibn Majah, Book of Trade, Chapter on Hoarding and Bringing Goods, Hadith: 2153 - Mustadrak Hakim: 2/11 - Sunan al-Darimi: 2/249, chain weak
In reality, there are two ways for a merchant to earn profit: one is that he accumulates goods so that he can sell them at high prices, meaning when items disappear from the market, desperate people are forced to buy at exorbitant prices. The other way is that the merchant brings goods to the market and sells them with a small profit, then brings more goods and sells them with a small profit as well, thus continuing his business. This kind of profit has civilizational wisdom and blessing, and such a merchant earns sustenance whose glad tidings the Prophet ﷺ has given.
An important hadith related to hoarding and manipulating prices is narrated from Sayyiduna Mu'adh ibn Yasar (RA). When he fell ill, the Umayyad governor Ubaydullah ibn Ziyad came to visit him, and Sayyiduna Mu'adh (RA) said: I heard the Messenger of Allah ﷺ say: Whoever intervenes in prices to cause hardship for the Muslims, Allah has the right to place him on the fire on the Day of Judgment.
Reference: Musnad Ahmad: 275 - Mustadrak Hakim: 2/12-13 - Tabarani in al-Kabir: 20/479, chain weak
In light of such hadiths, scholars have deduced that the prohibition of hoarding is conditional on two things: first, that hoarding is done in a place or under circumstances where it causes hardship to the inhabitants; second, that the intention is to raise prices in order to make a large profit.
Artificial Intervention in Market Freedom
An important point regarding hoarding is that a city dweller should not sell the goods of a villager. The Prophet ﷺ prohibited this. The situation is such that an outsider brings essential goods to the market for sale at market prices, but a city dweller comes and says, "Give me the goods so that I can sell them later at a higher price." If the villager sold the goods himself, the items would be sold at a lower price, and he would earn some profit while others would also benefit. This malpractice was very common at that time.
Sayyiduna Anas رضي الله عنه says:
نهينا أن يبيع حاضر لباد ولو كان أخاه لأبيه وأمه
"We were forbidden from selling the goods of a villager by a city dweller, even if he was his own brother."
Reference: Musannaf Ibn Abi Shaybah: 14/287 and the wording is from Bukhari, Book of Sales, Chapter on Buying from a Present Person for a Bedouin through Brokerage, Hadith: 2161 - briefly Muslim, Book of Sales: Chapter on the Prohibition of Selling the Present for the Bedouin, Hadith: 1523 - with the wording 'even if he is his brother or father'
It is understood that public interest takes precedence over personal or individual benefit. The Prophet ﷺ said:
لا يبيع حاضر لباد، دعوا الناس يرزق الله بعضهم من بعض
"No city dweller should sell the goods of a villager. Leave people to their own condition. Allah will provide for them through one another."
Reference: Muslim, Book of Sales, Chapter on the Prohibition of Selling the Present for the Bedouin, Hadith: 1522
From this, an important principle in trade is understood: the market, prices, and exchange should be left to their natural state without interference so that natural competition and factors cause fluctuations in prices. When Sayyiduna Ibn Abbas رضي الله عنهما was asked about the meaning of لا يبيع حاضر لباد, he said: it means that there should be no middleman.
Reference: Bukhari, Book of Sales, Chapter on the Prohibition of Receiving Caravans, Hadith: 2163 - Muslim, Book of Sales, Chapter on the Prohibition of Selling the Present for the Bedouin, Hadith: 1521
Generally, a broker worries about his commission and forgets the public interest in such matters.
Brokerage is Permissible
There is no harm in brokerage if it is done in connection with other matters. Because a broker acts as an intermediary between the seller and the buyer and facilitates both or either party. In the present time, there is a need for intermediaries in import and export transactions and between wholesale and retail traders. These intermediaries are brokers who play a very important role. There is no harm in them taking their agreed-upon fee, whether in cash form, as a suitable commission from the profit, or in any form agreed upon by both parties.
Imam Bukhari, may Allah have mercy on him, says: According to Ibn Sirin, Ata Ibrahim, and Hasan Basri, there is no harm in the broker’s fee, and Sayyiduna Ibn Abbas, may Allah be pleased with them both, says, "They say there is no harm if you sell this cloth and whatever you receive more than that is yours."
And Ibn Sirin, may Allah have mercy on him, says: "There is no harm in saying this: sell it at such and such a price, and whatever profit there is will be yours or will be shared between you and me."
Reference: Bukhari, Book of Hiring, Chapter: The Fee of Brokerage, commentary before Hadith: 2274. These narrations were also reported by Ibn Abi Shaybah in Al-Musannaf - 578/65. As for the hadith, it was reported by Al-Daraqutni in Al-Sunan: 301, and Al-Hakim in Al-Mustadrak: 49/2, and its chain is weak but it has a supporting narration reported by Ahmad: 366/2, and Abu Dawood, Book of Judiciary, Chapter on Settlement, Hadith: 3594, and Tirmidhi, Book of Judgments, Chapter 17, Hadith: 1352.
The Prophet, peace and blessings be upon him, said:
المسلمون عند شروطهم
"A Muslim is bound by his conditions."
Unlawful profiteering and deception are forbidden
One of the things related to external and artificial interference is "Najsh," which the Prophet ﷺ prohibited.
Reference: Bukhari, Book of Sales, Chapter on Najsh, Hadith: 2142
According to the explanation of Sayyiduna Ibn Umar رضي الله عنه, "Najsh" is when you do not intend to buy the goods, but you bid higher than the price so that another person buys the goods by paying a higher price.
Reference: Muslim, Book of Sales, Chapter on the Prohibition of Selling on Another's Sale, Hadith: 1516
This method is generally adopted with the intention of deceiving others.
To keep trade dealings free from profiteering and prices free from deceit and other impurities, the Prophet ﷺ prohibited buying goods outside the market before they arrive in the market.
Reference: Muslim, Book of Sales, Chapter on the Prohibition of Receiving Goods Before Arrival, Hadith: 1517
Otherwise, the arrival of goods in the market will not occur properly, and as a result, appropriate prices cannot be established because the determination of prices depends on the arrival of goods in the market and the demand for them. The mentioned situation is such that the seller does not know the market price. This is why the Prophet ﷺ allowed the seller to completely cancel the previous transaction once the goods arrive in the market.
Reference: Muslim, Book of Sales, Chapter on the Prohibition of Receiving Goods Before Arrival, Hadith: 1519
Whoever deceives us is not one of us
Islam has declared all forms of deceit and fraud forbidden, whether related to buying and selling or other human affairs. Islam demands that a Muslim adopt truthfulness in every matter. Sincere adherence to religion is more valuable than any worldly benefit.
The Prophet Muhammad (peace be upon him) said:
البيعان بالخيار مالم يتفرقا فإن صدقا وبينا بورك لهما فى بيعهما وإن كذبا وكتما محقت بركة بيعهما
“The seller and the buyer have the option of canceling or confirming the bargain until they separate. If both speak the truth and disclose defects (fully clarifying the condition of the goods), their transaction will be blessed. But if they lie and conceal defects, the blessing of the transaction will be removed.”
Reference: Bukhari, Book of Sales, Chapter: When the two sellers disclose and do not conceal defects: 2079 - Muslim, Book of Sales, Chapter on Truthfulness in Sales and Disclosure, Hadith: 1532
ومر رسول الله برجل يبيع طعاما فأعجبه فأدخل يده فيه فرأى بللا فقال ما هذا يا صاحب الطعام قال أصابته السماء فقال فهلا جعلته فوق الطعام حتى يراه الناس من غشنا فليس منا
“Once the Messenger of Allah (peace be upon him) passed by a grain seller. He liked the grain, but when he touched it, he felt moisture. He asked: What is this? He said: It has become moist due to rain. The Prophet said: Then why did you not place it on top of the grain so that people could see it? Whoever cheats us is not one of us.”
Reference: Muslim, Book of Faith, Chapter: The Prophet’s Saying: Whoever cheats is not one of us, Hadith: 102 - Tirmidhi, Book of Sales, Chapter on the Dislike of Cheating in Sales, Hadith: 1315
The pious predecessors of Muslims used to disclose defects in goods when dealing, spoke the truth, avoided lies, demonstrated sincerity, and completely refrained from deceit. For example, Imam Ibn Sirin (may Allah have mercy on him) once sold a goat and told the buyer: “I am free of responsibility by disclosing its defect. This goat spreads fodder around with its feet.” Similarly, Hasan bin Salih (may Allah have mercy on him) once sold a slave girl and told the buyer: “This slave girl once spat blood.”
Frequently Swearing Oaths
The prohibition becomes doubly severe when false oaths are sworn with deceit. The Prophet Muhammad (peace be upon him) forbade merchants from frequently swearing oaths, especially false ones. He said:
الحلف منفقة للسلعة ممحقة
"By swearing oaths, wealth may be sold, but the blessing is taken away."
Reference: Bukhari, Book of Sales, Chapter: Allah Destroys Usury and Increases Charity, Hadith: 2087 - Muslim, Book of Transactions, Chapter: Prohibition of Swearing in Sales, Hadith: 1606
Frequently swearing oaths in business is disliked because it increases the likelihood of misrepresentation, and as a result, the greatness of Allah in the heart is also diminished.
Cheating in Measurement and Weighing
One type of deception is to reduce the measure and weight. The Quran has strongly emphasized this aspect of the matter:
وَأَوْفُوا الْكَيْلَ وَالْمِيزَانَ بِالْقِسْطِ ۖ لَا نُكَلِّفُ نَفْسًا إِلَّا وُسْعَهَا
"And give full measure and weight in justice. We do not burden any soul beyond its capacity."
Reference: (Surah Al-An'am: 152)
وَأَوْفُوا الْكَيْلَ إِذَا كِلْتُمْ وَزِنُوا بِالْقِسْطَاسِ الْمُسْتَقِيمِ ۚ ذَٰلِكَ خَيْرٌ وَأَحْسَنُ تَأْوِيلًا
"And when you measure, measure with full measure, and weigh with a balance that is straight. That is better and fairer in the end."
Reference: (Surah Bani Isra'il: 35)
وَيْلٌ لِّلْمُطَفِّفِينَ 1 الَّذِينَ إِذَا اكْتَالُوا عَلَى النَّاسِ يَسْتَوْفُونَ 2 وَإِذَا كَالُوهُمْ أَو وَّزَنُوهُمْ يُخْسِرُونَ 3 أَلَا يَظُنُّ أُولَٰئِكَ أَنَّهُم مَّبْعُوثُونَ 4 لِيَوْمٍ عَظِيمٍ 5 يَوْمَ يَقُومُ النَّاسُ لِرَبِّ الْعَالَمِينَ
"Woe to those who give less [than due], who when they take a measure from people, take in full, but when they give by measure or by weight to them, they cause loss. Do they not think that they will be resurrected for a tremendous Day? The Day when mankind will stand before the Lord of the worlds."
Reference: (Surah Al-Mutaffifin: 1 to 6)
The concept of true justice is difficult, but it is certainly the responsibility of a Muslim to be just as much as possible. That is why the Quran commands to deal with full justice in matters of measure and weight, saying:
لَا نُكَلِّفُ نَفْسًا إِلَّا وُسْعَهَا
"We do not burden any soul beyond its capacity."
Reference: (Surah Al-An'am: 152)
The Quran also narrates the story of a nation that adopted an oppressive approach in transactions and began to cause loss to people. Allah sent a messenger to guide them to the path of justice and reform. This nation was that of Prophet Shu'ayb (peace be upon him), who, while inviting them and warning them of a bad end, said:
أَوْفُوا الْكَيْلَ وَلَا تَكُونُوا مِنَ الْمُخْسِرِينَ 181 وَزِنُوا بِالْقِسْطَاسِ الْمُسْتَقِيمِ 182 وَلَا تَبْخَسُوا النَّاسَ أَشْيَاءَهُمْ وَلَا تَعْثَوْا فِي الْأَرْضِ مُفْسِدِينَ
"Give full measure and do not be among those who cause loss. And weigh with an even balance and do not cheat people of their due and do not spread corruption on the earth."
Reference: (Surah Ash-Shu'ara: 181 to 183)
This incident serves as an example (a lesson) which makes it clear how a Muslim should live and what principles he should adhere to in his relationships and all his dealings. It is not the work of a Muslim to measure with two different scales and weigh with two different balances; to have one measure for taking and another for giving. When taking, weigh fully and take, but when giving to others, do not cause loss.
Buying Stolen Goods is Partnership with the Thief
Islam has prohibited the purchase of anything known to be usurped or stolen property, or obtained unjustly from the rightful owner, in order to oppose crime and make its commission difficult. Because in such a case, the buyer cooperates with the usurper, thief, and oppressor in the matter of usurpation, theft, and oppression.
من اشترى سرقة وهو يعلم إنها سرقة فقد اشترك فى إثمها وعارها
"Whoever buys stolen goods knowing that they are stolen, he shares in the sin and wrongdoing of the (thief)."
Reference: Mustadrak Hakim: 2/35, Al-Sunan Al-Kubra by Al-Bayhaqi: 5/335-336 and its chain is weak
The sin does not vanish by the passage of a long time over stolen property because in Islam, the length of time does not make the forbidden lawful, nor does the matter becoming old (ancient) nullify the right of the original owner. Some human laws also recognize this.
