TAWARRUQ

❓ DEFINITION ❓

  1. sale contract

⭐ MAIN FEATURES ⭐

👥 PARTIES INVOLVE 👥

✅ APPLICATION ✅

  1. purchase contract

involves the sale of an asset by a seller to a purchaser on a deferred basis

the purchaser of the first sale will sell the same asset to a third party on a cash and spot basis.

👤 seller

👤 purchaser

👤 wakil (agent) may involve

the seller in the first sale and purchase contract shall not be the purchaser in the second sale and purchase contract in the same tawarruq

⚠ sale and purchase contract in a tawarruq

⚠ The purchaser in each sale and purchase contract in the tawarruq shall
have the right to take delivery of the asset

shall be executed by entering into a separate and independent sale and purchase contract.

shall satisfy all the necessary conditions of a valid sale and purchase contract under Shariah

must be respectively evidenced by appropriate documentation or record.

⚠ Payment of the deferred selling price including profit shall not be made to the seller before entering into the sale and purchase contract

  1. Customer goes to bank and applies for tawarruq
  1. Bank buys Commodity from market
  1. Bank sells commodity to client, Client pays bank on credit
  1. Client appoints bank as agent
  1. Bank sells to market, Market pays cash
  1. Bank pays client cash