Gharar is arguably one of the least understood concepts in Islamic finance. In linguistic terms, it means jeopardy, risk, danger, or hazard, and is a verbal noun (maṣdar) from the word taghr, which in turn means exposing oneself or one’s property to danger. It may refer to ignorance, injustice, or deceit.
As of yet, no single, universally accepted definition of the term has been proposed, and most scholars who have been dealing with the subject opted for providing examples of contracts prohibited due to the presence of gharar rather than coining a comprehensive definition of the term itself.[1]
First attempts at defining gharar can be found in al-Muwattaʾ, in which Mālik b. Anas mentions not only the actual ḥadīth prohibiting gharar (nahā rasūl Allāh ʿan bayʿ al-gharar), but also discusses the concept while writing about some other sales contracts. In general, the early scholars believed that a transaction is contaminated by gharar if there is any uncertainty over i) the existence of the subject-matter of the transaction, ii) one or more characteristics of the object under sale (e.g., species or quantity), or iii) one or more of the characteristics of the contract itself (e.g., timing of the transaction). Moreover, some specific kinds of transactions—such as bayʿ al-ḥaṣāt (pebble sale), bayʿ al-mulāmasa (touch sale), or bayʿ al-munābadha (toss sale)—were prohibited on the grounds of containing gharar as well.
It was not until the 14th/8th century, however, that two prominent Ḥanbalī scholars, Ibn Taymīyya and his student Ibn al-Qayyim al-Jawzīyya, argued that it is not the (non)existence of the subject-matter of transaction but rather the (in)ability to deliver it by the seller that matters in determining whether a given transaction is contaminated by gharar—and, as such, is prohibited. At the same time, Ibn Taymīyya was of the opinion that the prohibition of gharar is not unequivocal; should a greater benefit (al-maṣlaḥah al-rājīḥa) be achieved from its abolition, then a contract contaminated by gharar is to be exceptionally permitted (rukhkhiṣa) under those particular circumstances.[2] In other words, if the cost of avoiding gharar is too high and the benefits from its embracement outweigh the harms it might possibly cause, then the prohibition should be temporarily lifted, and a transaction should be deemed valid. This was also the opinion of a Shāfiʿī scholar contemporary to Ibn Taymīyya, Taqī al-Din al-Subkī, who additionally supported the claim that only major (fāḥish) gharar is prohibited, while the minor one (ḥaqīr) does not affect the validity of a transaction.[3] Moreover, most of the scholars agreed that gharar can only affect commutative contacts, with gifts being exempted from its influence.
The origin of the prohibition of gharar can be traced back to the Qurʾān, even as the term is not directly mentioned anywhere in the holy book of Islam. What the Qurʾān does explicitly forbid is maysīr (2:219, 5:90–91), literally a game of arrows that with time came to be understood as an all-encompassing term for all types of gambling. While the Qurʾānic commentaries do not really discuss gharar when exploring āyāts dedicated to maysīr, many scholars (such as the already mentioned Ibn Taymīyya and Ibn al-Qayyim[4]) equated (major) gharar with gambling (qimār or maysīr). This has been done on the account of both devouring property of others in vain (akl al-māl bi-l-bāṭil), again explicitly prohibited by the Qurʾān (2:188, 4:29, 9:34). Indeed, this latter connection is explored in a number of tafāsīr, e.g., Aḥkām al-Qurʾān by Abū Bakr b. ʿArabī and Aḥkām al-Qurʾān by Aḥmad b. ʿAlī al-Rāzī al-Jaṣṣāṣ.
At the same time, the main and most explicit source of the prohibition of gharar derives from the sunna. Numerous aḥādīth deal with gharar; some of them are very general, some mention it in the context of a particular forbidden sale or a contract. The tradition most often adduced by scholars in the context of prohibition of gharar belongs to the first group and can be found in all canonical collections of aḥādīth, apart from al-Bukhārī’s, and reads (in various forms; see Table 1):
Nahā rasūl Allāh ( صلى الله عليه وسلم) ʿan bayʿ al-gharar (wa-bayʿ al-ḥaṣāt)
The Messenger of Allah (peace be upon him) prohibited gharar sale (and pebble sale)[5]
Table 1. Gharar matn composite
(Source: author’s compilation based on ḥadīth collections, as listed in the reference section).
There are 24 individual traditions with matn to that effect scattered over Sunnī collections of aḥādīth.[6] They can be broadly arranged into four clusters, each centered around one common figure: ʾAbū Hurayra, Ibn ʿAbbās, Ibn al-Mussayyab, and Mujāhid (with the fifth cluster being a “miscellanea” grouping).[7]
Analysis[8] of the matn composite and asānīd of each of those traditions (see Figures 1–3) suggests that that prohibition of gharar was first transmitted by Ibn al-Musayyab via an unknown figure (ḥadīth mursal), as recorded in al-Muwattaʾ by Mālik b. ʾAnas (both in the oldest comprehensive recession available today, i.e., the one by Muḥammad b. al-Ḥasan ash-Shaybānī [d. 189/805], and the most popular one, i.e., the one by Yaḥyā b. Yaḥyā al-Laythī [d. 234/848–9 or 236/850–1]). Subsequently, the expanded version of the tradition, containing both prohibitions of gharar and of bayʿ al-ḥaṣāt, was written down by Ibn Ḥanbal (all three belong to ʾAbū Hurayra bundle). Such an addition of a second part to the ḥadīth or combining two or more injunctions into one would not be unheard of, especially in case of short, legal maxims belonging to ḥalāl wa-ḥarām genre—much like the prohibition of gharar.
Figure 1. ʾAbū Hurayra bundle
Figure 2. Ibn ʿAbbās bundle
Figure 3. ʾAbū Hurayra and Ibn al-Musayyab bundles combined
(Sources: author’s compilation based on ḥadīth collections, as listed in the reference section).
These types of maxims are generally believed to be opinions of individual scholars that produced them when approached by their co-religionist with specific questions.[9] With time, those ad hoc opinions were to be remolded into aḥādīth and given the authority of a Companion or the Prophet—a process known as rafʿ. Indeed, ʿAbd ar-Razzāq aṣ-Ṣanaʿānī argued that this is precisely what happened with the ḥadīth in question at the hands of Maʿmar [ʿAbd ar-Razzāq 8:14506].
However, one may argue that this was not necessarily the case by taking a closer look at the alleged first transmitter of the tradition, Ibn al-Musayyab (Medina, d. 94/715), who belonged to the second generation of Muslims (Tābaʿīn) and was one of the seven fuqahāʾ of Medina.[10] During his lifetime, he was known to be an expert in legal matters and, much like the rightly guided caliphs, famous for setting his own standards and giving his own rulings, inspired by—but not exactly derived from—the Prophet.[11] Numerous traditions were narrated from him without going back to earlier authorities, although in later collections, when isnād science developed, they might have been supplemented by adding a Companion or even the Prophet at the very beginning of the chain of transmission.[12] In fact, a vast number of legal decisions—found in early collections both solely on his own authority, as well as narrated from a Companion or the Prophet—can be traced back to him. Gautier H. A. Juynboll argues that in such cases “it is … Ibn al-Musayyab who is to be credited with these legal decisions … rather than the Prophet or a Companion as mentioned in the ḥadīth collections compiled some hundred and fifty years later. … A legal decision that indeed does go back to the Prophet or one of his Companions simply does not require being put into the mouth of Saʿid [Ibn al-Musayyab] as also being a product of the latter’s reasoning.”[13]
More than that, assuming the latest date for the introduction of the Ibn al-Musayyab’s gharar tradition by Mālik, that is the year of his death (179/795), one cannot help but notice that it falls before Shāfiʿī’s (d. 204/819–20) introduction of the concept of sunna nabawīyya, that is ideally going back to the Prophet with uninterrupted chain of transmission (mutawātir).
Even more crucially, most scholars agree that during the early days of Islam, sunna was not understood as “examples from the life of the Prophet,” but rather as a set of general, not necessarily directly Prophet-inspired, rules that good Muslims were supposed to follow.[14] This was especially true in Medina—where all the major figures (up to al-Qāttan) in the chain(s) of transmission under investigation resided (see Figure 3)—to the point that Mālik’s al-Muwattaʾ should not be considered as a compilation of ḥadīth per se, but rather “a book of ʿamal, that is, a record of the accepted principles, precepts and precedents which had become established as the ʿamal of Madina [sic].”[15] Indeed, in al-Muwattaʾ, more traditions on the authority of Companions and Successors than the prophetic ones can be found. In the “Book of Sales” (Kitāb al-buyūʿ), which contains the prohibition of gharar, only 42 out of 219 traditions were narrated from the Prophet. Although 59 were from Companions, Successors, and other authorities, 89 were Mālik’s own opinions and 29 were based on the Medinese practice.[16]
These findings infer that the prohibition of gharar may, indeed, go back to the Prophet. Were it just Ibn al-Musayyab’s opinion, it could have been easily reported as such, as in many other cases. The possibility that such an aqwāl containing Ibn al-Musayyab’s opinion did exist, but went missing, can be undermined on account of the sheer number of surviving narrations of this very tradition going back to other authorities, as well as Ibn al-Musayyab himself. Curious is also the lack of a comprehensive definition of gharar. Had the tradition been the work of a later scholar in an attempt to force the proscription, it would have made sense for him to include some explanation of what he meant by the term.
Regardless of whether the prohibition of gharar was indeed instituted by the Prophet or developed by early Islamic scholars, it remains one of the key principles of Islamic finance and its understanding is key to the development of modern sharīʿa-compliant financial instruments.
[1] For a detailed overview of the definitions of gharar applied by scholars from various schools of jurisprudence throughout history, see, e.g., al-Siddīq Muḥammad al-Amīn al-Darīr, Al-Garar wa-Āthāruhū fi-l-ʿUqūd fi-l-Fiqh al-Islāmī (Cairo: Maṭbaʿ al-Dār Nasr al-Thaqāfa, 1967).
[2] Aḥmad b. ʿAbd al- Ḥalīm b. Taymiyya, Al-Qawāʿid al-Nūrāniyya al-Fiqhiyya (Jeddah: Dār ibn al-Jawzī, 2001), 172.
[3] Mahmoud A. El-Gamal, “An Economic Explication of the Prohibition of Gharar in Classical Islamic Jurisprudence,” Islamic Economic Studies 8 (2001).
[4] Ibn Taymīyya, Al-Qawāʿid al-Nurānīyya al-Fiqhiyya, 169.
[5] The extended versions of the tradition, inclusive of bayʾ al-ḥasāt prohibition, can be found only in traditions belonging to ʾAbū Hurayra bundle and all canonical collections, apart from Sunan Ibn Māja 12:2279, belong to this grouping. The oldest collection in which this version can be found is Ibn Ḥanbal’s Musnad; in the remaining pre-canonical collections, only the short version of the ḥadīth can be found.
[6] Collections reviewed include the Sunnī canonical ṣaḥīḥayn by al-Bukhārī and Muslim b. al- Ḥajjāj, Sunan of ʾAbū Dāwūd and Sunan of al-Nasāʿī, the Jamiʿ of al-Tirmidhī, Sunan of Ibn Majah, the Sunan of al-Dāraquṭnī and al-Muwattaʾ of Mālik b. Anas, as well as Musnad by Aḥmad b. Ḥanbal, Musnad by Abu Dāwūd al-Ṭayālisi, Sunan al-Kubrā by Bayhaqī, Sunan of ʿAbd Allah b. ʿAbd al-Rahman al-Dārimī, Musannaf of Ibn ʿAbī Shayba and Musannaf of ʿAbd ar-Razzāq al-Sanaʿani.
[7] Admittedly, some of them are too small to be called fully developed bundles in Motzki’s understanding.
[8] Using an isnād-cum-matn analysis framework. For a description of this method, see, e.g., Haral Motzki, “Dating Muslim Traditions: A Survey,” Arabica 52 (2005): 204–53; or Harald Motzki, “Quo vadis Ḥadīṯ-Forschung? Eine kritische Untersuchung von G.H.A. Juynboll: ‘Nāfiߵ the Mawlā of Ibn ߵUmar, and His Position in Muslim Ḥadīth Literature,” Der Islam 73 (1996):193–231.
[9] Umar F. Abd-Allah Wymann-Landgraf, Mālik and Medina: Islamic Legal Reasoning in the Formative Period (Leiden: Brill, 2013), 8–9; Ahmed E. Souaiaia, The Function of Orality in Islamic Law and Practices: Verbalising Meaning (New York: Edwin Meiler, 2006), quoted in: Adis Duderija, “Evolution in the Canonical Sunni Hadith Body of Literature and the Concept of an Authentic Hadith During the Formative Period of Islamic Thought as Based on Recent Western Scholarship,” Arab Law Quarterly 23 (2009): 17.
[10] Yūsuf b. ʿAbd ar-Raḥmān Mizzī, Tahdhīb al-Kamāl fī Asmāʾ ar-Rijāl (Beirut: Mu’assasa al-Risala, 1996), 11:66–75.
[11] Gautier H. A. Juynboll, Muslim Tradition: Studies in Chronology, Provenance and Authorship of Early Hadith (Cambridge: Cambridge University Press, 2008), 16; Harald Motzki, Nicolet Boekhoff-van der Voort, and Sean Anthony, Analysing Muslim Traditions: Studies in Legal, Exegetical and Maghazi Hadith (Leiden: Brill, 2010), 6.
[12] Juynboll, Muslim Tradition, 15.
[13] Ibid., 16.
[14] Adis Duderija, “Evolution in the Canonical Sunni Hadith Body of Literature and the Concept of an Authentic Hadith During the Formative Period of Islamic Thought as Based on Recent Western Scholarship,” Arab Law Quarterly 23 (2009): 401.
[15] Yasin Dutton, “The Origins of Islamic Law: The Qur’an, the Muwatta’ and Madinan Amal” in Culture and Civilization in the Middle East, ed. Ian R. Netton (Richmond, Surrey: Curzon, 1999), 22; Muḥammad b. al-Ḥasan ash-Shaybānī, The Muwatta of Imam Muhammad al-Shaybani: The Muwatta of Imam Malik b. Anas in the Narration of Imam Muhammad b. al-Hasan al-Shaybani (Cairo, 1994), 439.
[16] Wael B. Hallaq, “On Dating Malik’s Muwatta,” UCLA Journal of Islamic and Near Eastern Law 1 (2002): 59.
Ḥadīth collections used in the analysis:
ʿAbd al-Razzāq b. Hammām aṣ-Ṣanʿānī. Muṣannaf. Edited by Ḥabīb ar-Raḥmān al-Aʿzāmi. Beirut, 1970–1972.
Abū ʿAbd Allāh Aḥmad b. Muḥammad b. Ḥanbal. Musnad. Riyadh: Bayt al-Afkār al-Dawliyya li-l-Nashr wa-l-Tawzīʿ, 1998.
Abū ʿAbd Allāh Muḥammad b. Ismāʿīl al-Bukharī. Jāmiʿ al- Ṣaḥīḥ. Leiden: Brill, 1962.
Abū ʿAbd Allāh Muḥammad b.Yazīd b. Mājah al-Rabʿī al-Qazwīnī. Sunan. Cairo: Maktaba ʿIsā al-Bābī al-Ḥalabī: 1952–3.
Abū ʿAbd ar-Raḥman b. Shuʿayb b.ʿAlī b. Sinān b. Dīnār al-Nasāʾī. Sunan al-Nasāʾī bi-Sharḥ Jalāl al-Dīn al-Suyūṭī. Cairo: al-Maṭbaʿa al-Misriyya, 1930.
Abū Bakr ʿAbd Allāh b. Muḥammad b. Ibrāhīm b. Abī Shayba. Al-Muṣannaf. Riyad: Maktaba al-Rushd Nāshirūn, 2004.
Abū Bakr Aḥmad b. Ḥusayn b. ʿAli al-Bayhaqi. Al-Sunan al-Kubrā. Beirut: Dār al-Kutub al-ʿIlmiyya, 2003.
Abū Dāwūd Sulaymān b. Dāwūd aṭ-Ṭayālisī. Musnad: Taḥqīq ad-duktūr Muḥammad b. ʿAbd al-Muḥsin al-Turki. Hajar li-ṭ-Ṭibāʿa wa-l-Nashar wa-t-Tawzīʿ wa-l-Iʿalān, 1999.
Abū Dāwūd Sulaymān b. al-Ashʿath al-Azdī al-Sijistānī. Sunan. Beirut: Al-Maktab al-Islāmī, 1990.
Abū ʿĪsā Muḥammad b. Īsā b. Sawra at-Tirmidhī. Al-Jāmiʿ al-Ṣaḥīḥ. Cairo: Maktaba Muṣṭafá al-Bābī al-Ḥalabī, 1937–65.
Abū Muḥammad ʿAbdallāh b. ʿAbd al-Raḥmān al-Dārimī. Al-Kitāb al-Musnad al-Jāmiʿ. Mecca: Dār al-Bashāʾir al-Islāmī, 2013.
ʿAli b. ʿUmar al-Dāraquṭnī. Sunan al-Dāraquṭnī. Beirut: al-Muʾassasa al-Risāla, 2004.
Mālik b. ʾAnas. Muwattaʾ al-Imam Mālik: Riwaya Muḥammad b. al-Ḥasan ash-Shaybānī. Cairo, 1994.
———. Muwattaʾ al-imam Mālik. Riwaya Yaḥyā b. Yaḥyā al-Laythī. Beirut: Dār al-Gharb al-Islāmī, 1997.
Muslim b. al-Ḥajjāj. Ṣaḥīḥ. Cairo, 1955–6.