Is Selling Gold Through eBay’s Authentication Process Valid?

Answered by Shaykh Faraz Rabbani

Question

I sold ten grams of gold on eBay at a fixed price. The buyer paid eBay, which held the funds while the gold was sent to an authentication center and released to me about a day later.

Does the buyer’s payment to eBay count as my possession of the price, or must I actually receive it for the sale to be sound?

Answer

In the Name of Allah, Most Merciful and Compassionate

Your sale is valid, and nothing is owed. You should know, though, that the position it rests on is the minority one.

Do the Rules of Sarf Apply to Modern Currency?

Everything turns on one question: is gold sold for pounds a currency exchange (sarf) or an ordinary sale? For a true currency exchange, the rule is strict and undisputed.

Imam Marghinani (Allah have mercy on him) writes that “both counter-values must be taken into possession before the parties separate,” and that “if they separate in a currency exchange before taking possession of both counter-values, or of one of them, the contract is void, because the condition, which is possession, has failed” [Marghinani, al-Hidaya].

The disagreement is over what paper money is.

One. Modern currency has replaced gold and silver.

In this view, modern currency stands in the place of gold and silver, so gold against sterling is a currency exchange, and both sides must be taken into account before the parties part. That is the position of contemporary fiqh councils and standard-setting bodies, and it is the more widely held view today. On it, your sale was defective because eBay held the price against a risk you were still carrying, and money you cannot draw on is not money you possess.

Two. Paper currency is money by cconvention—andthe rules of “sarf” don’t apply to iit—butriba does apply to it.

The second view is the one we follow, and it goes back to Imam Muhammad ibn al-Hasan (Allah have mercy on him): paper currency is money by convention rather than by creation, and so stands in the position of fulus, the old copper coinage.

Shaykh Mufti Taqi Usmani (Allah preserve him) holds this the stronger position, noting in meaning that it applies with more reason now that gold and silver coins have gone out of circulation altogether, and rules on it that gold and silver may be bought with paper currency without the condition of taking possession, at the price of the day of the contract [Usmani, Fiqh al-Buyu].

On this, what you did was a sale, not a currency exchange; eBay’s day of delay is immaterial, and there is nothing to put right.

One boundary, and it does not move. Gold against gold and gold against silver remain a currency exchange on every view. Those must be equal where the metal is the same, and must change hands there and then in either case, with no delay of any kind.

Keep the Price, and Keep It Simple

Take the money with a clear heart and stop revisiting the sale. Where you have a choice, I still prefer the arrangement where payment and handover occur at the same time, since that is sound from both perspectives and costs you nothing.

And if you ever deal in amounts large enough to matter, put the specific structure to a scholar before you commit rather than after.

And Allah knows best.

[Shaykh] Faraz Rabbani

Shaykh Faraz Rabbani is a recognized specialist scholar in the Islamic sciences, having studied under leading scholars from around the world. He is the Founder and Executive Director of SeekersGuidance.

Shaykh Faraz stands as a distinguished figure in Islamic scholarship. His journey in seeking knowledge is marked by dedication and depth. He spent ten years studying under some of the most revered scholars of our times. His initial studies took place in Damascus. He then continued in Amman, Jordan.

In Damascus, he was privileged to learn from the late Shaykh Adib al-Kallas. Shaykh Adib al-Kallas was renowned as the foremost theologian of his time. Shaykh Faraz also studied under Shaykh Hassan al-Hindi in Damascus. Shaykh Hassan is recognized as one of the leading Hanafi jurists of our era.

Upon completing his studies, Shaykh Faraz returned to Canada in 2007. His return marked a new chapter in his service to the community. He founded SeekersGuidance. The organization reflects his commitment to spreading Islamic knowledge. It aims to be reliable, relevant, inspiring, and accessible. This mission addresses both online and on-the-ground needs.

Shaykh Faraz is also an accomplished author. His notable work includes “Absolute Essentials of Islam: Faith, Prayer, and the Path of Salvation According to the Hanafi School.” This book, published by White Thread Press in 2004, is a significant contribution to Islamic literature.

His influence extends beyond his immediate community. Since 2011, Shaykh Faraz has been recognized as one of the 500 most influential Muslims. This recognition comes from the Royal Islamic Strategic Studies Center. It underscores his impact on the global Islamic discourse.

Shaykh Faraz Rabbani’s life and work embody a profound commitment to Islamic scholarship. His teachings continue to enlighten and guide seekers of knowledge worldwide.

النصوص

[المرغيناني، الهداية في شرح بداية المبتدي]

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