Silent Partnership: Legitimacy of Silent Partnership Contracts in Modern Business and Trade

Practical Laws of Islam as per the teachings of Imam Khamenei

Silent Partnership: Legitimacy of Silent Partnership Contracts in Modern Business and Trade

English:

Question #1881:

Is it all right to make use of a silent partnership contract in domains such as production, services, distribution, and trade? And are the contracts of present-day silent partnerships outside the commercial arena concluded under this definition, legal?

Answer #1881:

A silent partnership contract should be confined to investing the capital in trade, i.e. buying and selling only. Using it under this title in the domains of production, distribution, services, and others is not permissible.
However, there is no objection to resorting to other shar‘ī contracts such as ju‘ālah and ṣulḥ.

-Imam Khamenei, Practical Laws of Islam, Importance and Conditions of Silent Partnership