Disagreement On Tawarruq Among Malaysian Shariah Advisors: An Analysis From Ma’alat Perspective

Abstract

This study aims to analyse the disputed issue on tawarruq munazzam (organised tawarruq) practised in Malaysia based on maqasid Shariah (objectives of Islamic law). In more detail, the researchers apply the principle of ma'alat (consequences of actions) which is one of maqasid principles as an approach to deal with the disputed issue on tawarruq. The methodology of this study is qualitative, in which the data are collected through library research and field studies. While the former is carried out by examining books, articles, statutes and related circulars, the latter is conducted through an unstructured interview method with some members of SAC (Shariah Advisory Council), SC (Shariah Advisor), academicians from BNM (Bank Negara Malaysia), IFIs (Islamic Finance Institutions) and public university. All data are analysed based on the content analysis method. The findings show a difference in views among informants on tawarruq munazzam contracts practised by IFIs. The study found that the tawarruq munazzam contract was a matter of dispute acceptable under Shariah discipline. However, if the dispute is not addressed properly, it might have a negative impact on industry stakeholders. Thus, this study seeks to resolve the dispute based on the method of ma'alat. Therefore, the study found that adopting a tawarruq munazzam contract can bring greater well-being to Islamic banking stakeholders rather than not practising it.