A questioner says: I own shares in a certain company, and I have developed doubts about its profits. I wish to get rid of them, so I put them up for sale, and I was offered a price for them.
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The questioner : May Allah reward the honorableThe Shaykh : I own shares in a certain company, and I have developed doubts about its profits. I wish to get rid of them, so I put them up for sale, and I was offered a price higher than what I invested when the company was first established. The question is: What is the ruling on this increase in the share price after the sale? Second: What is the ruling on the continuous profits that are paid annually, where a specific amount of money is paid for each share? May Allah reward you with good.
The Shaykh : Investing in companies in general: whoever is free from it is safer for his religion, because these companies are generally not free from riba (usury or interest). The reason is that they will have funds available, and these available funds cannot be left in the vaults without being moved. They will place them in banks and take profit on them. They may also reduce their expenses and take loans from banks, adding riba to them. Therefore, being safe from these companies is safer. However, if a person has already invested, we say: selling shares in a way that involves profit is permissible, even if you make a profit on them; the profit is yours. As for the continuous profit that is paid to a person every year, there is a detail to consider. If the profits are itemized in a statement, meaning on paper, where it is specified that this profit is from such-and-such work, this profit is from such-and-such work, and this profit is bank interest, then you should extract the bank interest and give it in charity to get rid of it, and the rest is yours. If there is no statement that clarifies the sources of the profits, and you are not certain that there is riba in them, then you are not required to extract anything from the riba. But if you are certain that there is riba, but you do not know its proportion, then extract half; it is not for you, nor is it against you. This is the detail regarding annual profits. Yes.
The Shaykh : Investing in companies in general: whoever is free from it is safer for his religion, because these companies are generally not free from riba (usury or interest). The reason is that they will have funds available, and these available funds cannot be left in the vaults without being moved. They will place them in banks and take profit on them. They may also reduce their expenses and take loans from banks, adding riba to them. Therefore, being safe from these companies is safer. However, if a person has already invested, we say: selling shares in a way that involves profit is permissible, even if you make a profit on them; the profit is yours. As for the continuous profit that is paid to a person every year, there is a detail to consider. If the profits are itemized in a statement, meaning on paper, where it is specified that this profit is from such-and-such work, this profit is from such-and-such work, and this profit is bank interest, then you should extract the bank interest and give it in charity to get rid of it, and the rest is yours. If there is no statement that clarifies the sources of the profits, and you are not certain that there is riba in them, then you are not required to extract anything from the riba. But if you are certain that there is riba, but you do not know its proportion, then extract half; it is not for you, nor is it against you. This is the detail regarding annual profits. Yes.