XII

Mawquf -alaih

The corpus of the endowed property, c o n s i s t i n g of

hayrat and akarat.

Mawquf lahu

The beneficiary or beneficiaries of waqf. These must

already be in existence (ahliyyah al-wujub) or be a class

of beneficiaries which are ascertainable or simply be for the

public.

Mudharaba

Mudharaba exists when a financier (rab ul-mal) invests

funds with an entrepreneur (mudharib) to embark on a

business venture, with the goal of sharing the profits from

that venture (Mansuri, 2006). The Maliki school considers

mudharaba a form of partnership. This contract is used

today in most equity investment.

The Sharia’ principles of profit and loss results in the

financial downside to the financier being the loss of 100%

of his investment (except where the loss is caused through

negligence or wrong-doing of the mudharib), and the

entrepreneur his sweat- equity. T h e profit ratio, however,

must be pre-determined beforehand. The rab ul-mal has

no right to participate in the business, except with the

consent of the mudharib, and in that instance, he only has

supervisory rights and not final say. Neither rab ul-mal nor

mudharib may guarantee the amount of profits that the

other will receive, and neither may guarantee or indemnify

the other against loss or liability (except in the case of

negligence or wrong-doing).

Musharaka

A partnership where all partners contribute capital to the

venture.

A partnership (shirkah al-’aqd) may be in equal shares

(mufawadah) or in unequal shares (man), and the

partners may agree as t o the type of investment each

would make, i.e. whether any or all partners would

invest financially (shirkah al-amwal) or all partners

would jointly labour (shirkah al-amal), or both

(Mansuri, 2006).

Sharia' principles require that risk of financial loss must be

shared according to the proportion of capital invested,

There is also another form called

shirkah al-.wujuh

consisting of one of the partners lending his name or reputation to the venture to

enable the other partners to purchase goods or trade. This form is not universally accepted by all the madhabs and, in any event, is not

pertinent to the discussions herein.