Is a fixed monthly profit of 2% from a pharmaceutical company, with final settlement of profits and losses at year-end, considered usury (riba)?
If the monthly amount paid is on account and settled at the end of the year, with a guarantee that the capital is not guaranteed in case of loss not resulting from transgression or negligence, then there is no objection to it. However, if the monthly amount is taken in all circumstances, this is forbidden because it is a loan with usurious interest. This is what scholars have unanimously agreed upon regarding the invalidation of (profit-sharing partnership) if one or both parties stipulate for themselves a specified number of dirhams (money). In this case, all profit belongs to the capital owner, and the worker receives a fair wage for his work. Some scholars have gone further, stating that the worker receives a fair share of the profit instead of a fair wage.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
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- Original fatwa ID
- 115398
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- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
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- Read the full answer on Ftawy