Ittifaq Dhimni

Ittifaq Dhimni is a sale and re-purchase of the underlying asset of which the

prices are agreed by the parties prior to the completion of the contract. This is an

external agreement which must be reached before the contract can be concluded to

allow for the bidding process to take places.

Sanadat

A long term debt security issued by the public or the private organization with a

promise to pay back the debt to investor base on a pre- agreed date of settlement. A

good example of sanadat is “Sijil Simpanan Premium” from BSN

Ujrah/Ajr

A financial charge for the utilization of services or manfaah. Ujrah is defined as

wage. Ijarah is closely related to ujrah because Ijarah is a form of wage which is the

wage on the manfaat that is given. In today’s context, for example, leasing a house , it

means wage of the manfaat of the house. Ujrah also can be placed on services or job.

This is called as a salary. It is also can be called as commission if it referring to agency

such a land broker that collect commission on his/her effort to sold the owners land. All

the Ujrah concept stated above is has its own regulation that we must follow to be

considered legal in the eyes of syari’ah.

In Malaysia, the current news about ujrah is the implementation of ujrah in

PTPTN loans. The rate of 1% of the amount of loan per year. The rate is a flat rate.

Although the rate is pretty low, but in Islam it is forbidden to charge the ujrah based on

the percent of the amount of the of loan given. This way of calculation is the same way
as the riba’ financial charge which is haram. So, to adhere with shari’ah, the

implementation of ujrah should be on true cost that incur from the loan process only. It

is not have any connection with the amount of the loan.

Sukuk

Sukuk is defined a document or certificate which represent the value of an

assets. Sukuk are securities bonds that comply with Islamic law (shari’ah) and its

investment principles, which prohibit the charging or paying of the interest. It is a

mechanism for raising finance in the international capital markets through Islamically

acceptable structure.

Muqaradhah Bonds an alternative for Islamic debt bonds.

An ideal Islamic financial system must have a set of rules that is governed strictly

by the Shari’ah principles. Our community needs a new financial device that comply

with the Shari’ah principle. Muqaradhah bonds are the best instrument for this matter. It

is a Islamic bond which is no interest is earned, but whose market value varies with the

anticipated or expected profit. It is termed as a bond because since it maturity period is

determined by the project completion date.

Muqaradhah bond is a financial instrument for raising equity capital. It is a form of

investment to the capital provider. This financial instrument is called as Muqaradah

Sukuk Bonds (MSB). The MSB represent a common ownership and entitles their

holders share in the specific project which the bonds have been issued for financing

purposes. The Duration for the ownership is will be limited to the duration of the specific

project or business on which the Muqaradhah was based.

 There is a few feature of MSB. First MSB represent common ownership and

entitles their holders to a share in the specific projects against which the MS have been

issued. Next, the MSB contract is based on the official notice of the issue or the

prospectus, which must provide all information required by Shari’ah, such as the nature

of the capital, the ratio of profit distribution and other condition related to the issued ,

which is must comply with shari’ah. Third, The MSB holder is given the right to transfer

the owner ship by selling the Sukuk in the securities market at his discretion. The

market value of Muqaradah Sukuk varies with business status and anticipated or

expected profit of the specific project. The sale of MSB must follow the rules on

condition of Muqaradhah Capital; in the form of money, in the form of debt and in the

form of a combination of cash , receivables, goods, real assets and benefits. Fourth, the

manager that receive the MSB , also can invest his own money in the project. Fifth, No

guarantee is allowed in MSB, be it from the manager to the fund , to the capital or profit

on the percentage of capital as Islam forbids fixed income. Lastly, it is allowed to create

a reserve for contingency purposes.