There is a type of sale in which those who wish to purchase the item gather, and each one writes his name and the price he proposes for it on a piece of paper.

The questioner : Our Shaykh, there is a type of sale for which we seek the Islamic ruling. The procedure is that those who wish to purchase the item gather in a hall, and each one writes his name and the price he proposes. For example, if he wants to buy a car, he writes eight thousand, or nine thousand, or ten thousand. Then the papers are collected and opened, and the one who offered the highest price is the one to whom the car, or the item, is sold. Is this type of sale permissible or not?

The Shaykh : If the procedure you are describing is genuine and realistic, and there is no manipulation or agreement among the parties who came to buy regarding the price—meaning, the aim is to purchase the item at the lowest possible price—then if there is nothing of that sort, it is permissible, because it falls under the category of auction sales. In fact, this is purer than a public auction. However, we know that sometimes those who gather collude and agree among themselves, pretending that one is paying, for example, five, and the second is paying six, and so on, until they reach one hundred, when the item is actually worth two hundred or three hundred. Consequently, he is forced to sell it at the initial price, which is actually a price agreed upon by the group who came to buy. The point is: if there is no deception, it is permissible.