What is the difference between two scenarios regarding the vacating of a commercial shop in a commercial area for the purpose of renting it, whether one is the owner of the shop or its tenant?

The questioner : ... meaning that is not the point, meaning whether the man is offering it or someone comes and says to him, "Vacate it for me and I will give you," what is the difference between the two, as long as we want to say that it is not permissible to take anything unless that thing is a right? If the shop is worth this...

The Shaykh : What is it worth?

The questioner : It is worth that if someone came out of it in exchange for using a space, for example, in the goldsmiths' market, the presence of a person in the goldsmiths' market is a place from which he benefits by being in that location. So, one has a shop, either with the intention that he wants to vacate the shop, and he says to someone, "If you do not take it from me, you will pay me this much," or he meets someone and says to him, "If you get out of this shop, I will pay you this and that." It is approximately known that these shops have equal value. What is the difference between the two cases?

The Shaykh : Glory be to Allah, we clarified the difference previously. The *furogiyyah* (vacating fee) is either real or illusory.

The questioner : It is real.

The Shaykh : Is it not real? Is there reality in it and is it illusory, or not? I mentioned two scenarios, real and illusory. You say it is real. Do you mean that every *furogiyyah* is real?

The questioner : No, I mean...

The Shaykh : Allow me, the letter S-J (referring to the word "real"), do you mean that every *furogiyyah* is real?

The questioner : No, no.

The Shaykh : You do not mean that?

The questioner : No. I mean by reality that it is...

The Shaykh : Allow me, reality was that a person is enjoying this property and does not want to vacate it at all because he is doing well in it, so Zayd from among the people comes and says to him, "Vacate this for me." That is real, correct?

The questioner : Correct.

The Shaykh : So, what is your question? You say whether it is like this or like that.

The questioner : He is sitting in this place and is happy with it, and everything is fine. It may occur to him to ease his situation, and if this place remains, its value will make him this much profit. So, S from among the people comes, or he is looking for S from among the people who is willing to come and take this shop of his and make this profit in it. He says to him, "If you want to take the shop from me, you will pay me this much," just as if that other one came, he would say to him, "You will pay me this much..."

The Shaykh : Mr. Adnan, may Allah guide us and you, does he want to rent the shop or does he want to buy it?

The questioner : He wants to vacate it.

The Shaykh : Does he want to rent it or does he want to buy it?

The questioner : The one coming from outside wants to rent it, of course.

The Shaykh : Yes?

The questioner : He wants to rent it, a tenant replacing the other.

The Shaykh : Okay, and is he the owner or a tenant?

The questioner : A tenant.

The Shaykh : Yes?

The questioner : A tenant.

The Shaykh : A tenant, the one benefiting from the property is a tenant?

The questioner: Yes.

The Shaykh : Okay. So, the previous detail, did you focus on it in your mind and were you convinced by it, or not?

The questioner: Yes.

The Shaykh : And the tenant is not allowed to dispose of this rented property because he is not its owner. I do not think you were with us on this point.

The questioner : The owner's consent is required, meaning?

The Shaykh : We stated this explicitly, and therefore now you have placed the tenant in the place of the owner. But I, so that we reach the point you are hovering around, will assume that he is the owner. I will assume that he is the owner, or I will assume the second scenario: a tenant who has agreed with the owner that he will rent it out, okay?

The questioner : Yes.

The Shaykh : Because it came out weak.

The questioner : I am only concerned with the case of the tenant.

The Shaykh : Be patient, I am with you, but let me assume premises for you so that their results are lawful. If their results are lawful, they are built on lawfulness. But if their result is not lawful, even if built on lawfulness, actions are judged by their endings, as came in the hadith, even if not in this context. I am assuming with you now that this is the owner of this shop in the market you mentioned.

The questioner : And he is utilizing it?

The Shaykh : What was our discussion?!

The questioner : Meaning he owns it?

The Shaykh : Yes, and he decided that he will move to a wider shop because Allah has made him successful, and so on, and he wants a wider shop. And the shop, he wants to rent it or build it, as our friend said. The important thing in the scenario is that he is now not as he was in the past, as you said, that he was living and earning a livelihood, and so on. He no longer has a need for it. You depicted a scenario just now that he said to some people, "I want to vacate this place," and they came, and he says, in Jordanian expression, "Come, buy from me," even though he is not the owner, meaning he wants a *furogiyyah* for this place, and the rent is between him and the owner of the shop. Now, this man wants to take from him what? A *furogiyyah*.

The questioner: Yes.

The Shaykh : The *furogiyyah*, he wants to take it, brother, the owner, and it is the rent. We mentioned just now what it means for a newly built property to be advertised, and the review is with so-and-so, he goes to so-and-so and says to him, "The annual rent is this much and the *furogiyyah* is this much." The annual rent is in exchange for what? In exchange for the four walls without benefiting from the vacancy? I hope this custom has not become and will not become. If the intended meaning of the rent is benefiting from the vacancy of this place, this is correct. Okay, and the *furogiyyah* is in exchange for what? This is from the category of consuming people's wealth unjustly. We return to your scenario: he announces that he wants to leave this place and move to another, and he wants a *furogiyyah* in exchange for what? What is the *furogiyyah*? We said the *furogiyyah* is from the rent; the rent is what gives him ownership of benefiting from the vacancy. So, this which they call *furogiyyah* is in exchange for what? I am asking and not answering. Now, it is supposed that you, Adnan, give me the answer.

The questioner : In exchange for the fame of the place and the man's frequenting of it and its being...

The Shaykh : Is this statement correct?

The questioner : In many cases, it is correct.

The Shaykh : Allow me, the empty property that has not been utilized yet, the *furogiyyah* is in exchange for what?

The questioner : There is none, unless it is built within this market.

The Shaykh : Look, what is the *furogiyyah* doing in people's minds? Do not take me wrong, you are now saying that there is none in this scenario, but rather some people who are merchants and knowledgeable say to you, "Let us hear the opinion here now." In exchange for what is this empty shop wanting rent and wanting a *furogiyyah*? In exchange for what is this *furogiyyah*?

Another questioner : Let us assume the value of the land is, for example...

The Shaykh : Mr. Professor, may Allah bless you, the value of the land is in the rent. I mean, allow me a moment, Abu Yahya, if we assume a shop four meters by four in the heart of the market, like a shop four by four outside the town, on the edge of the town, would their rent be the same?

Another questioner: No.

The Shaykh : So, this difference that you are observing regarding the value of the land, this difference is calculated in the rent that is set for the property. Until now, I am asking: the *furogiyyah* is in exchange for what? Nothing at all.

Another questioner : There is no point here.

The Shaykh : Please go ahead.

Another questioner : Let us assume the most important area in Amman, or the most expensive vacancy that people take, for example, in Saqf al-Sayl. Of course, Saqf al-Sayl is not like Jabal Amman or any other area. The custom and habit in the country is different from the Shari'ah ruling. If you want to take a vacancy in the Saqf al-Sayl area, your rent has to be around fifteen thousand dinars per year, and this is illogical.

The Shaykh : But the *furogiyyah* is logical!

Another questioner : No, I am not saying it is logical. I am speaking of logic other than the Shari'ah ruling. I have separated the Shari'ah ruling now from the custom and habit of people.

The Shaykh : For people, the *furogiyyah* is logical.

Another questioner : Yes.

The Shaykh : Is not this what I am saying?

The questioner : Why? Because I mentioned that if you want to consider that the rent must be higher, it means the key money for a place in Saqf al-Sayl should be around fifteen thousand dinars per year. And this is not actually the case now; they are taking key money now, and the rent is approximately one thousand dinars. So the rent would be about the same as in another area in Amman. For example, now in Jabal Amman, behind our house, the rent is one thousand dinars. In Tala', if you rented a shop, it would be about one thousand five hundred dinars, but the key money is about one hundred thousand dinars. How is this to be handled? Let us also suppose that I have an empty plot of land in this Saqf al-Sayl area, worth one million dinars, and I want to build on it. How would I rent it out? It is not logical that I build it and then do not take key money, and only take one or two thousand dinars in rent.

The Shaykh : You, Muhammad, are going too far. I want someone to convince me so that I might change my opinion. And there is a hand raised asking: What is the key money in exchange for? Since there is a rent in one place that differs from the rent in another place of the same size, but the difference in location raises the rent of the property above that of others. Well, we know this, just as you know it. What is the key money in exchange for? Now you said key money of one hundred thousand; in exchange for what? There is no answer. But Abu Yahya is extending us with his support. My brother, we said the rent for the area is higher; its rent is higher for what reason? Is it not for the area?

The questioner: Yes.

The Shaykh : What is the key money for?!

Another questioner : In the name of Allah, the Most Gracious, the Most Merciful. I do not want to convince you to the extent that I want to clarify to you what they are saying.

The Shaykh : Leave me alone, what are they saying? But you give me a reasonable point of view: what is the key money in exchange for?

Another questioner : In what is called in commercial custom and the commercial sciences that we studied, there is something called "reputation" (shahrah), which Adnan has been talking about.

The Shaykh : May Allah preserve you.

Another questioner : Reputation is the ability of that specific place to yield a distinct profitability compared to another similar shop in the same trade, meaning...

The Shaykh : You, Abu Yahya, if I interrupt you, just a very brief word. You are not talking about the first scenario, which clarifies the other scenarios: an empty property, newly built. Talk about this property as you wish. I told you to leave me alone from their talk, but you will not let me.

Another questioner : Okay, let us start with the second one, but it is fine if I tell you what they are saying.

The Shaykh : About this scenario. For example, the Ministry of Islamic Endowments builds a large building and announces that it is available for rent. A Muslim goes to rent it, and the Ministry of Islamic Endowments says, "This property has not yet been occupied by anyone. The annual rent is such-and-such, and the key money is such-and-such." Give me the point of view of the Ministry of Islamic Endowments: what is this key money in exchange for?
Abu Malik : Our Shaykh, the truth is that they are not taking it in exchange for something. It is a name for "key money," but in reality, this name does not give its true meaning.

The Shaykh : It is fine. We have a colleague who says, when he makes a mistake, we remove the word "key money." What do we put in its place?
Abu Malik : Of course, this is a common name in the market.

The Shaykh : No problem.
Abu Malik : But they consider this amount that they take under the name of key money as part of the rent, paid in advance. This is what happens, and this is the truth without doubt.

The Shaykh : No, that is not so.
Abu Malik : No, no, this is it, our Shaykh.

The Shaykh : It is fine, please go ahead.
Abu Malik : I am telling you why they call it part of the rent, as evidence that it decreases. The rent decreases. For example, if the rent for a shop is one thousand dinars a month, it becomes five hundred dinars. This is what happens. So in reality, this is the case, and there is nothing else.

The Shaykh : This is an argument I have already addressed in my speech. I said, no, it is not counted as part of the rent, because if it were part of the rent, it would follow the rent up and down.
Abu Malik : It reduced the rent.

The Shaykh : It is not attached to the rent at all.

Another questioner : What Abu Malik mentioned, this specific aspect regarding this issue, is valid in the sense that there are indeed some shops where you go to the property owner and he says to you, "My key money is such-and-such, as Adnan said. If you pay this key money, the rent will be such-and-such. And if you do not want to pay key money, the rent will be such-and-such." The condition is like that. And this actually happens. This relates to some modern shops...

The Shaykh : Excuse me, repeat that. It will be such-and-such...

Another questioner : I mean, I am giving a real example so that it is not hypothetical. This actually happened to me, and I hope you trust that this happened.

The Shaykh: Yes.

Another questioner : When I took the shops, new shops, he said, "This is the key money, and this is the rent." When there was negotiation between me and him, they reduced the key money and increased the rent. Here, the minds of both parties truly turned to the fact that you are benefiting from this commercial style, whether it is right or wrong. You are benefiting from a property that cost me this much. According to commercial custom, I am supposed to recover its cost after ten years. If you divide your rents plus the amounts you paid me, I recover my property after ten years. So there was a kind of justice between the direct or inverse proportion, let us say, between the rent and the key money. This is one pattern. There are other patterns that are completed as haram, as you mentioned. They are not all on this pattern. Rather, the aspect that Abu Malik talked about happens in some shops, and it happened to me. I am interested in returning to the basis that Adnan raised. Adnan wanted to say that if there is a shop in the gold market, what difference does it make if the one renting the shop says, "I want to leave it for the key money"? What difference does it make if someone came and said to him, "No, you leave it for key money"? I want to say what the merchants say and what the science we learned in universities says. I am not defending it, but I am clarifying.

The Shaykh : Please go ahead.

Another questioner : When we brought in a partner with us, it happened that we brought in a new partner, so we came and audited the goods and valued the capital. We looked at our shops and saw what was going on. There is something in commercial science called "reputation." Reputation is the ability of the shop to achieve a certain profitability. For example, a shop in the gold market sells gold, and a thousand customers visit it during the day. A shop in the same type of gold and selling jewelry in a remote area has five customers a day. The ability of this shop, by virtue of its location and the reputation it built as a result of people visiting it, became such that its return on the single dinar is twenty percent, while the same shop and the same goods with the same rent and the same people do not yield a profit of more than one percent. The reason is that the presence of this central shop in that place bestowed upon it what is called "reputation." So when Zayd comes to take the shop from 'Umar, 'Umar demands from him compensation for the benefit he will give him as a result of his presence in this location. This is one. Two, he considers it as part of: I worked in this shop for five years. As a result of my effort, I built up customers for this shop. The customers I built up as a result of advertising, promotion, a friendly face, good relationships, and giving them credit—this talk is valued in commercial science as money. When I want to give it up, you should pay its price. These two elements constitute what is called "vacating" (khalu), but in reality, if it is reduced to its elements, these two are among the components of reputation.

The Shaykh : Abu Yahya, you are repeating the speech in detail and with benefit, but there is no summary underneath. Why?
Abu Yahya : Why.

The Shaykh : We distinguish between the one who is asked to pay the "vacancy fee" and the one who wants to pay it. We distinguish between a person who is asked to pay it and what you said, which is that the specific commercial philosophy revolves around this, and I agree with you to sign a blank check. But now we always want to address reality, and we do not want to address imaginary or rare scenarios; we want to address the reality we live in today. The reality we live in today, as I gave you the example of the Ministry of Awqaf in some countries: a new building is constructed, and they demand a rent and what? And a vacancy fee. Fine. Is it permissible for there to be a disagreement in commercial logic that it is not permissible in Sharia-compliant trade? This scenario is absolutely the clearest of all; other scenarios vary in their forms and colors, like pure purifying water, pure non-purifying water, and impure water. Their forms are varied. If something happens to this pure purifying water, it takes it out of its original ruling into two other rulings. So now we want to take this water that has become impure and changed its three attributes—not just one attribute where there is doubt that it is impure? There is no doubt. This scenario is a real estate building that Zayd from among the people built. When he wants to hand over the rented property, he demands a rent and he demands a vacancy fee. As for this vacancy fee, I have not yet heard an answer to it. Is there an answer in your speech, Abu Yahya?

Another questioner : That is what Abu Malik said.

The Shaykh : And what is it?

Another questioner : That it is a part, or that this vacancy fee is an amount paid in advance to reduce the annual rent amount, or in the sense of deferring its installments on...

The Shaykh : I said this statement is not correct, as evidenced by the fact that the rent goes down and this vacancy fee does not go down. If it were a part of the rent, they would follow each other. And I want to say something new now, which is why, as the professor said, this word "vacancy fee" does not convey the true idea behind it. I said, let us call it by another name in order to convey the intended meaning. We have not yet thought about it, and it does not concern us now to think of a name that conveys the true meaning, but I say, why do we deceive each other, even with a word in which we agree that the intended meaning is not "vacancy"? That is not the intention. What is the intention? Rent. So why do we not say "the rent for this property" instead of saying "the annual rent is, for example, one thousand or ten thousand"? It does not matter to me. Let us say twenty thousand. Let us say fifteen thousand.

Another questioner : This is the safer and more cautious approach.

The Shaykh : No problem. Why do we not take this path? Why do we leave the matters as they are? Why do we call this a vacancy fee and consider permissible this scenario that no Muslim would ever accept? Why do we not say "rent"? I will say something. Why? Because this vacancy fee will benefit other people who are neither lessors nor owners. Whereas if it were rent, the rent has to go to every tenant, and this is up to whom? The owner. He may raise it or lower it if he wishes. And this, as you pointed out just now, is subject to supply and demand. If there are, for example, many buildings, the rent will become cheaper, and if there are few, it will become more expensive, and so on. So why do we not use the method that has no problem at all?

Another questioner : A comment, if you please.

The Shaykh : Please go ahead.

Another questioner : I have a relative who was building a structure in the market, a large structure.

The Shaykh: Yes.

Another questioner : This is what happens between the owners of commercial shops. He builds a structure, and the structure costs about one hundred or one hundred and twenty thousand dinars. So, with the word "vacancy fee," he becomes the lessor of the entire structure. And before they pay him the rent for the structure at the end of each year, meaning when the tenants have fully occupied it, they will have paid him the full price of the structure. That is, he took the price of the structure in advance from the tenants, and then, on top of this, from within the capital he invested in the structure, and then any amount exceeding this will be profit for him. This is what is happening now.

The Shaykh : Are you speaking about commercial logic or Sharia logic?

Another questioner : I am speaking about their intention. Why do they take the vacancy fee?

The Shaykh : This is your statement. It concedes Abu Yahya's point. He wants to speak with the logic of the neighbor.

Another questioner : I condemn them. This is a method of blackmail that some people practice.

Another questioner : At the expense of the tenants, as if he is building it at their expense, and the remaining rent is the profit he has realized.

The Shaykh : But if this is the meaning you intend, is this a reality?

Another questioner : This is a reality, yes.

The Shaykh : Here, Abu Yahya.

Another questioner : But he forgot something important. It is true that the cost of construction... what happens is that in very limited areas where there is crowding on very small plots of land, these very few plots have a very high price, really very high. So what does he do? He comes and sells some of it, or he rents...

The Shaykh : He rents what?

Another questioner : On the blueprint.

The Shaykh : A blueprint?

Another questioner : Yes, just as happens in Syria. He comes and takes vacancy fees. These vacancy fee amounts, in full, are like those who build apartments now; they cover the cost of construction, or a quarter of it, or half of it, or so. It becomes a form of financing. But he forgot. Of course, this is a method I do not approve of. They make profits. Where is the benefit? The benefit is from the imbalance of supply and demand. In other words, he wants to put out ten shops, but the demand in that area is for one hundred people who are ready for that. He exploits and benefits from the high demand and low supply. And this is the logic of Western commercial thought: when there is an imbalance and lack of equilibrium between supply and demand, prices rise. If supply increases, prices fall, and so on. This is the logic of trade in the Western concept. And it happens. Now, many of those who build apartments—no one from the companies that build apartments does not take the price of almost all the apartments, and the financing is done with the money of the people who subscribed to the project.

Another questioner : Our Shaykh, also in support of your statement regarding the vacancy fee: when he takes this amount, this money benefits him over time. The dinar now is better than the dinar tomorrow, which is better than the dinar the day after tomorrow. So when he takes the thousand dinars he calls a vacancy fee, it is better for him to distribute it over twelve months. So, in his view as a merchant, he puts them in the bank and also takes interest on them, which realizes a quick profit for him, and he benefits from it now.

Another questioner: ..

The questioner : Setting that aside, but this is not always the case, but this is what happens with most of those who put their money in banks.

The Shaykh : Please, go ahead.

The questioner : Exploiting the need of the person who appears to be investing or renting for the large opportunity for profit. So if he will enjoy a large opportunity for profit, he is willing to pay a price for this. What prevents this statement in the Sharia contract? That is, when he takes this place, it is as if he is obtaining a large possibility for profit, which is like a commodity in the market, and he pays for this opportunity willingly and by choice. So it is a contract between two parties who are mutually satisfied with this thing which, in their view, both yield a profit. He is paying for the opportunity, and the other party asks him and says, "I am ready."

The Shaykh : This statement, Professor Adnan, does it not apply exactly to those who deal in riba? Say it plainly.

The questioner : In what sense? That riba gives an opportunity for profit?

The Shaykh : Both benefit. Say it plainly.

The questioner : Correct. Buying and selling...

The Shaykh : No. May Allah forgive you. Buying and selling is subject to profit and loss.

The questioner : And this is subject to profit and loss.

The Shaykh: No.
Abu Malik: The scenario you are talking about, which is handing over the amount before the construction or during the construction.

The questioner : Let us leave it for after the construction.
Abu Malik: If you please, no, no, it is not two scenarios. After and before, meaning before completion or at the beginning. This is most like, in reality, selling what you do not have. This is correct. It resembles it very much, and it is most like selling with gharar, because this will certainly lead to disagreement. As for the scenario after completion, this applies to it to some extent.

The questioner : I likened it to riba (usury or interest) because it involves profit.

Another questioner : What Adnan says about shops that have vacancies and shops that do not have vacancies in reality, where a vacancy does not appear in a specific area after two streets with no vacancies, in shops in the middle of the city with vacancies, this is based on what? It is based on the fact that this shop actually has customers and has its returns, and people earn their livelihood.
Abu Malik: The scenario you disagreed on is that if, for example, the person who was renting the commercial shop closed the shop and wrote "Shop for Rent" ... the customers, of course, are the ones who go in this case and offer to him, saying, "We will give you a vacancy," not that he will ask for a vacancy; we want to give it to you. This is what happens.

The Shaykh Allah is the Greatest.
Abu Layla : ...