Islam is a religion that is supportive of trade and commerce and is unabashedly pro-business. It lays down detailed rules as to how Muslim companies and other Muslim businesses should conduct themselves in business. At the same time, Islam tries to ensure support for the weak and feeble. The Prophet Mohammed (SAAS) held that the status of an honest Muslim businessman is equal to that of a martyr in the cause of Allah and urged Muslims to engage in commerce.
In a Hadith, the Prophet (SAAS) says that nine-tenths of all the bounty of God, which includes income, is derived from commerce. To a large extent this explains the drive of Muslims over the centuries to meet their economic needs through commerce. The Muslim companies of today are the heirs of this centuries-old tradition, including the principle that recognizes profits as not only legitimate but a desirable way of engaging in human industry. Profits are very much part of activities of Muslims and Muslim companies , if they are obtained in a permissible way. However, profits cannot overshadow the duties of brotherhood, charity, solidarity, and they are, of course, subject to Zakat, which is a particular tax imposed upon Muslims.
Muslim companies are guided by Islamic rules of conduct between Halal and Haram, meaning essentially that which is permissible and that which is not. The general rule is: that which is not explicitly or implicitly impermissible is therefore permissible. The distinction between Halal and Haram applies to legitimate and illegitimate profits. The illegitimate profit is particularly exemplified by riba, which is roughly equivalent to usury. However, it also has come to mean the collection of a predetermined fixed amount of interest.
The only products that Muslim companies may not deal in are things such as intoxicants, swine, idols or the like, since the use of these items by Muslims is haram. Muslim companies that fulfil a need in society are regarded as good, with certain exceptions. Muslim companies cannot invoke the principle of caveat emptor, and the Shari’a requires them to make everything clear about any article they sell, including any defects it contains. Both parties have a right to cancel a transaction as long as they have not yet separated.
