What is the Sharia ruling for the following transactions: Firstly: A partnership between (Omar) and (Zayd) where (Omar) contributes 100,000 riyals and (Zayd) contributes 50,000 riyals, and the profit is divided proportionally to each partner’s contribution (Omar’s profit being double Zayd’s), and losses are divided in the same manner. Is it permissible for (Omar) to take a larger percentage of the profit by mutual agreement in return for his management of the business, and what is a reasonable percentage for that? Secondly: A partnership in which (Zayd) enters with (Omar), the owner of a retail store, with an amount of 100,000 riyals for one year. (Omar) offers (Zayd) estimated monthly profits ranging between 2,000 and 3,000 riyals, based on his market experience and the difficulty of determining the exact profit due to the commingling of capital and the variety of goods, provided that losses are estimated in the same way? Thirdly: What is the ruling on the same previous transaction, with the difference that goods are purchased with the amount, and the repayment of the capital and estimated profits (180,000 riyals) is scheduled in monthly installments over one year? Fourthly: What is the ruling on the same previous transaction, with the difference that the estimated profits are paid monthly (30,000 riyals in monthly installments), and the capital remains tied up for one year, with losses estimated based on (Omar’s) experience?
There is no objection to two individuals partnering with their money and one of them contributing their physical effort. The basic principle concerning partnerships is permissibility, whether two bodies partner with the money of one of them, or two bodies partner with the money of others, or a body and money, or two sums of money and the physical effort of one of their owners, or two bodies with their respective monies, whether the money is equal or differs.
As for losses, they are distributed according to the capital; thus, the partner contributing two-thirds of the capital bears two-thirds of the loss, and the partner contributing one-third bears one-third of it. This is a matter of consensus among scholars.
Summarized from the full answer at Ftawy · reviewed Sep 2, 2026
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