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The Economic System of Islam5 min readViewed 1 time

14.5 Monopoly


Monopoly is prevented absolutely, and it is forbidden in Shar’a due to the decisive prohibition of it that came explicitly in the Hadith. S’aid ibn Al-Musayyab narrated from Mu’ammar ibn Abdullah Al-‘Adawi in Bukhari that the Prophet (pbuh) said: “No one monopolises except the wrongdoer.” Al-Athram narrated from Abu Umamah, He said: “The Messenger of Allah (pbuh) forbade that a foodstuff be monopolised”. And Muslim narrated through his chain of narrators from S’aid ibn Al- Musayyab that Mu’ammar said: “The Messenger of Allah (pbuh) said: “Whoever monopolised is a wrongdoer.”’ The prohibition in the Hadith indicates the refrain and the dispraising of the monopoliser by describing Him as a wrongdoer, however the wrongdoer means the disobedient. This is a concatenation which indicates that this prohibition is decisive. Thereupon, the Ahadith indicated that monopoly is Haram. The monopoliser is the one who hoards the commodities until the price rises so as to sell them expensively such that it becomes difficult for the citizens to buy them. As for the meaning of the monopoliser (Muhtakir) as being the one who hoards commodities waiting for their price to rise, this is because the word monopolised (Ihtakara) linguistically means to gather something and hold it waiting until it becomes expensive and then sell it for a high price. It also means Istabadda i.e. to hold back (hoarded) the goods so that they are sold expensively. As for the condition of monopoly that it should reach a limit at which it becomes difficult for the citizens to buy the monopolised commodity, this is because the reality of the monopoly is not conceived to happen except in such a situation. If it did not become difficult for the people to buy the commodity then it would not have been gathered nor held back to be sold expensively. Therefore, the condition of the monopoly is not only to purchase the commodity; rather it is gathering it and waiting for its price to rise so as to sell it expensively, which is considered monopoly. This applies whether the monopoliser compiled it through purchase, or from the harvest of his large land because He is the only person to plant such type of harvest or for such type, because of it being rarely planted or He compiled it from his factories, as the sole manufacturer, or because of the shortage in this type of industry as is the case with the capitalist monopolies, who monopolise manufacturing a certain thing by eliminating other factories and thereby monopolise the market. All these forms are called monopoly because they fit exactly to the linguistic meaning of the word monopolised (Ihtakara), which again means holding the commodity from sale and waiting for its price to rise so as to sell it expensively.

Monopoly is prohibited (Haram) in all things without a difference between the human foodstuff or animals foodstuff, a foodstuff or not a foodstuff, and of the people’s necessities or luxuries. This is because the linguistic meaning of the word monopolised (Ihtakara) is to compile a thing in its absolute sense (without specification). The word monopolised did not come in the meaning of compiling the foodstuff or the people’s necessities, rather compiling the thing, so it should not be confined to other than its linguistic meaning. And also because the explicit meaning of the Ahadith that came in the subject of monopoly indicate the prohibition of monopoly in everything. This is clear because the Ahadith came absolute without qualification, general without specification; so they have to stay absolute and general.

With regard to what came in some of the Ahadith narrations concerning limiting the monopoly to foodstuffs only, like the Hadith: “The Messenger of Allah (pbuh) prohibited monopolising the foodstuffs”, and other narrations. In this regard, mentioning of foodstuffs in the Hadith does not make monopoly confined only to foodstuffs. As well, it is not true to say in this matter that prohibition came as unqualified (Mutlaq) in some narrations, and came as qualified (Muqayyad) to foodstuffs in others. So the unqualification (Mutlaq) should be explained according to the qualified (Muqayyad). This is not true because the word foodstuff (Ta’am) mentioned in some narrations is not fit for qualifying the unqualified (Mutlaq) narrations, it is rather a specific mentioning of one of the individual things which the unlimited (Mutlaq) indicates. This is because excluding other than the foodstuffs from the divine rule of prohibiting monopoly is based on using the meaning of the title (Mafhum al-Laqab), a matter which is not applied (i.e is invalid); accordingly, the meaning of the title is not fit for qualification nor for specification. Thus, mentioning the foodstuffs in some narrations of the Ahadith of monopoly is only nominating one of the types of monopoly as an example, not as qualifying monopoly in foodstuffs nor as a description which has a meaning that has to be used; it is rather a rigid (Jamid) name for a specified thing, that is to say it is a title not a description, so its meaning is not used. That which fits to qualify or specify the rule is that which has a meaning (Mafhum) that can be used, a matter which does not apply in this case. This indicates that the narrations which forbid monopoly, even those which mentioned the foodstuffs, are unqualified (Mutlaq) and general (A’am), thus they include the prohibition of the monopoly in everything absolutely.

The reality of the monopoliser is that He monopolises the market; and imposes upon people whatever price He likes by holding the commodity as a monopoly, so people will be forced to buy it from Him at a high price, for it is not available other than to him. Thus the monopoliser in fact wants to increase the price for the Muslims, a matter which is Haram, due to what was narrated from Ma’akal ibn Yasar, that He said that the Messenger of Allah (pbuh) said: “Whosoever was involved in any of the prices of the Muslims, so as to increase it for them it would be due on Allah to place Him in a great fire at the Day of Judgement.”

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Chapters (110)
  1. 11 Introduction to the Economic system
  2. 21.1 The Capitalist Economic System
  3. 31.2 The Economic System versus Economic Science
  4. 41.3 The Socialist Economic System
  5. 52 Economy
  6. 62.1 The Basis of the Economic System
  7. 72.2 The View of Islam towards the Economy
  8. 82.3 Economic Policy in Islam
  9. 92.4 The General Economic Principles
  10. 103 Types of Ownership
  11. 113.1 Private Ownership
  12. 123.2 Definition of Private Ownership
  13. 133.3 The Meaning of Ownership
  14. 143.4 The Means of Owning Property
  15. 154 The First Means of Ownership - Work
  16. 164.1 Cultivation of Barren Land
  17. 174.2 Extracting that which exists inside the earth
  18. 184.3 Hunting
  19. 194.5 Mudharaba
  20. 204.6 Share Cropping - Musaqat
  21. 214.7 Hiring-Employing an Employee
  22. 225 The Work Of The Employee Worker
  23. 235.1 Definition of the Work
  24. 245.2 The Type of Work
  25. 255.3 Duration of the Work
  26. 265.4 Wage for Work
  27. 275.5 The Effort Spent in the Work
  28. 285.6 The Ruling Regarding Hiring Over Prohibited Benefits
  29. 295.7 The Ruling of Hiring Non-Muslims
  30. 305.8 Hiring Someone to perform Worships and Public Services
  31. 315.9 Who is the Employee?
  32. 325.10 The Basis upon which the Assessment of the Wage is Established
  33. 335.11 Estimating the Employee's Wage
  34. 346 The Second Means Of Ownership
  35. 356.1 Inheritance
  36. 367 The Third Means of Ownership
  37. 377.1 The need for Property for Sustenance
  38. 388 The Fourth Means Of Ownership
  39. 398.1 That which the State gives of its Properties to the Citizens
  40. 409 The Fifth Means Of Ownership
  41. 419.1 The Property obtained by Individuals
  42. 4210 The Way To Dispose Of Property
  43. 4310.1 Right of Disposal
  44. 4410.2 Increasing Property
  45. 4510.3 The Rules of Lands
  46. 4610.4 Cultivation of Barren Land
  47. 4710.5 Disposal of Land
  48. 4810.6 Preventing the Leasing of Land
  49. 4911 Trading And Manufacturing
  50. 5011.1 Trade
  51. 5111.2 Manufacturing
  52. 5212 The Laws Of Partnership Companies
  53. 5312.1 The Company in Islam - Partnership
  54. 5412.2 The Company of Equal - Al-Inan
  55. 5512.3 The Companies of Bodies - Al-Abdan
  56. 5612.4 The Company of Body and Capital - Mudharaba
  57. 5712.5 The Company of Reputation Faces - Wujooh
  58. 5812.6 Company of Negotiation - Mufawadha
  59. 5912.7 Dissolving the Company
  60. 6013 Capitalist Companies
  61. 6113.1 Commercial Company of Joint Liability
  62. 6213.2 Joint-Stock Company - Share Companies
  63. 6313.3 Shares of the Share Stock Company
  64. 6413.4 Co-operative Societies
  65. 6513.5 Insurance Ta’meen
  66. 6614 The Prohibited Methods of Increasing Ownership
  67. 6714.1 Gambling
  68. 6814.2 InterestUsury (Riba)
  69. 6914.3 Criminal Fraud
  70. 7014.4 Deceit in Trade
  71. 7114.5 Monopoly
  72. 7214.6 Price-Fixing
  73. 7315 Right of Disposal to Spend in Gifts and Maintenance
  74. 7416 Public Property (AlMilkiyyah Al- Ammah)
  75. 7517 State Property
  76. 7618 Nationalised Property is neither Public nor State Property
  77. 7719 Seclusion (Hima) in the Public Interests
  78. 7820 Factories
  79. 7921 Bait ul Mal (The State Treasury)
  80. 8021.1 Revenues of Bait ul-Mal
  81. 8121.2 The Expenditures of Bait ul-Mal
  82. 8221.3 The State Budget
  83. 8321.4 Zakat
  84. 8421.5 The Head Tax (Jizya)
  85. 8521.6 The Land Tax (Kharaj)
  86. 8622 Distributing Wealth among the People
  87. 8722.1 Economic Equilibrium in Society
  88. 8822.2 The Prohibition of Hoarding Gold and Silver
  89. 8923 Riba and Currency Exchange (Sarf)
  90. 9023.1 Riba (Interes-tUsury)
  91. 9123.2 Currency Exchange (Sarf)
  92. 9223.3 Exchange Transactions
  93. 9324 Money-Currencies (An-Nuqood)
  94. 9424.1 The Gold Standard
  95. 9524.2 Benefits of the Gold Standard
  96. 9624.3 Problems facing the Gold Standard
  97. 9724.4 The Silver Standard
  98. 9824.5 Metallic Money
  99. 9924.6 Paper Money
  100. 10024.7 Issuing of Currency
  101. 10124.8 Exchange Rate of Currencies
  102. 10225 Foreign Trade
  103. 10325.1 The Reality of Foreign Trade
  104. 10425.2 Balance of Tarde
  105. 10525.3 Currency-Monetary Relations Between Countries
  106. 10625.4 Foreign Trade Policy
  107. 10725.5 Free Trade
  108. 10825.6 Protectionism
  109. 10925.7 National Economy
  110. 11025.8 Policy of Self-Sufficiency