What is the Sharia and legal characterization of a clause in a partnership agreement that guarantees a minimum monthly profit for one of the partners, with any shortfall considered an advance to be deducted from the final profits?
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The Sharia and legal characterization of a clause in a partnership agreement that guarantees a minimum monthly profit, with any shortfall considered an advance, varies. On one hand, it might be viewed as a religiously prohibited (haram) profit guarantee, rendering the contract void (batil), as profit in partnerships must not...
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