Not permissible :
Fatwa Negeri Pulau Pinang, Fatwa Negeri Pahang dan Fatwa Negeri Selangor (before). 

1. Selangor Fatwa Committee meeting (April 27), was issued declaring ASB/ASN investments to be permissible for Muslims. 

- the same committee had previously prohibited ASB/ASN investments due to the presence of riba (interest or usury) transaction. 

2. National Muzakarah Fatwa Committee for Religious Affairs (Feb 3, 2008) 

- Investing in ASB/ASN is permissible mainly due to its significant economic impact and potential with regards to Malay Muslims (the majority of Muslims in Malaysia). 

Why permissible : 
-The worrisome socio-economic realities of Malay Muslims. 

- ASB/ASN only the institution that has a positive track record in yielding consistent and considerable returns to its majority Malay Muslim investors. 

- Considering the wider public interest (maslahah ammah) and the avoidance of harm (mafsadah). 

- ASB/ASN investments coincides with the goals of syariah to offer opportunities to Malaysian Muslims wanting (hajiyyah).

i)Sub-standard housing accommodation due to insufficient public facilities

and infrastructure

ii)Lack of water supply and sanitation

iii)Health problems

iv)Social problems

v)Environmental degradation 

-Legislation and Squatters

A squatter's right is a legal allowance to use the property of another in the absence of an attempt by the owner to force eviction. This right may eventually be converted to title to the property over time by Adverse Possession, if recognized by state law. “Squatting” is an old casual word for occupying a place that legally belongs to someone else when that owner hasn’t given permission for the occupation. “Squatter’s rights” is an assertion that someone is entitled to own land after he’s been squatting there. The legal name for squatter’s rights is “adverse possession.”

The doctrine of adverse possession discourages disuse of property. According to the doctrine, if property was abandoned, and someone else "squatted" on it for a number of years, the squatter could gain control over the land. If the squatter abandons the property for a period, or if the rightful owner effectively removes the squatter's access even temporarily during the statutory period, or gives his permission, the squatter loses the benefit of that possession. If that squatter later retakes possession of the property, that squatter must, in order to acquire title, remain on the property for a full statutory period after the date on which the squatter retook possession. However, one squatter may pass along continuous possession to another squatter, known as "tacking", until the adverse possession period is complete. In the United States, squatting laws vary from state to state and city to city.

Summary Proceedings to Squatters 

 

Order 89 of the Rules of Court 2012 provides for possession of land through summary proceedings. Several elements need to be established by an applicant to justify the application:

 

 

If all the above elements are established, then the Court will provide an order for vacant possession and for the squatters to remove themselves from the land. Upon an order being granted, the property owner can then enforce this through a writ of possession. In other words, the summary proceedings bypasses the need to individually identify the squatters or defendants.

 

Temporary Occupation License

The state government also grants the Temporary

Occupation License (TOL) to occupy government’s land

. The land can be of road or river reserves, or land set aside for future development. However, the squatters will take advantage of the presence of vacant land to build their houses. For that reason, the government allows access to TOL for the squatters. This would, in turn, make them stay legally on government’s land. Through this way, the government will not pay any compensation when acquiring back the land, therefore saving cost. Squatters often take advantage of vacant land to build buildings whether for residential or small business.

Halal and haram investment in EPF since the board of director EPF was announced that EPF include both halal and haram elements, the public were quite concerned regarding their position in the investment.

EPF include both halal and haram elements, the public were quite concerned regarding their position in the investment. As a simple guide, Muslim contributors have not sinned as they do not have an option according the pension fund which it is the country’s law and compulsory for every worker. From the Syariah point of view, we need to analyze the relationship between contributors and EPF.

EPF is on the basis of wadiah (saving for old days). Thus, it is responsibility of EPF to guarantee our savings for usage during our golden age. If they do not provide this guarantee, then it contradicts their role as a savings management institution. If EPF gains any return, they would distribute the dividends to the contributors. From the Syariah perspective, this dividend is known as hibah or gift to the contributors. The only concern that arises here is whether we can accept and use the dividend received EPF. Since EPF has mixed investments, a portion of the dividend (based on haram investment) must be given to charity. We are free to use the principal portion and dividend from halal investments.

RULING ON DISTRIBUTION OF EPF MONEY TO CONVERTED MUSLIM

 

The 61st Muzakarah (Conference) of the Fatwa Committee National Council of Islamic Religious Affairs Malaysia held on 27th January 2004 has discussed the ruling on distribution of EPF money to converted Muslim. The Committee has decided that: 

1. According to Islamic law, non-Muslim does not inherit from Muslim and vice versa. 

2. If a Muslim convert has EPF savings and has nominated a non-Muslim as the nominee, he/she has to change the nominee to another Muslim nominee. If there is no Muslim nominee and no Muslim heir entitled to the property, the property should be given to the Baitul Mal and it is not the property of the non-Muslim heirs. 

3. Muslim can make a will for non -Muslim but not more than 1/3 of the property 

 

Therefore, the members of EPF will have the chance to invest their fund through Islamic investment instruments, whereby the EPF produced two different pool of fund through two separated accounts, a conventional account and Islamic account. Each account will be channel to different pool of fund that will be investment according to the nature of the account. Therefore, fund mobilized under the Islamic account will be invested in Shariah compliant products and instruments, which make the return and profit generated permissible and acceptable from Shariah perspective. The list of Shariah compliant instruments that can be used for investment is as follows: 

 Malaysian Government Islamic Securities 

 Islamic Bonds / Sukuk 

 Islamic Money Market Instruments 

 Shariah Stock 

 Islamic Property 

 International Islamic Investments 

 

 

-Majority ICC holders did not understand the ICC structure even Muslim. The knowledge level among Muslim is low. Some of them only received it from education only ( tertiary education) and the balance did not receive any formal education. Although those who have knowledge , might not understand well on the structure of ICC. 
-Since the people are lack of knowledge especially in ICC, the ICC are not popular as compared to CCC. 

- The researcher had made sampling and the results in number of ICC holders  is not from the majority of Muslim Malay. They even still holding the CCC. This shows that ICC is even not popular among Muslim especially. 

- Researchers had made comprehensive study on Islamic contract, structure and operationof ICC, and the results shows that ICC considered as noncompliant since they may have fabricated transaction and operations in complete the process which embedded with riba elements. 

- CCC’ s holders are not interested in ICC’s product becausethey never engaged with ICC. But, both cards holder had strong belief on Sharial compliance in ICC since they had used and utilised both credit cards and this reflects the customers satisfaction and positive feeling. 

- Result research from Banjarnahor (2006) found that credit interest rate factors, credit amount, time period and customer service influence credit demand decisions. 

- Government policy is a big influencer for the determination of interest rates in the country. 

- Islamic bank users are very sensitive to interest rate changes and react even more strongly than conventional banks users. 

- Since interest is prohibited, Islamic bank treat the depositors as an investors rather than creditors. 

 

-Panel Study of Income Dynamic which made a bankruptcy survey found that most frequent reaons that households filling bankruptcy was “ high debt/ misuse of credit cards”.

-National Foundation for credit counselling on 2006 analyse that two thirds from them having difficulties in financial management due to “ poor money management and excessive spending”. 

-In United States, there were ‘usury laws’ which limited the maximum interest rate that lenders could charge on loans, and this situation had held down of willingness to issue credit cards. on that time, bankruptcy fillings remains constant along 1970’s. But on 1978, US Supreme Court destroy the ‘usury laws’ in Marquette decision, and the results of the destroy of ‘ usury laws’ for both credit cards debt and bankruptcy fillings rapidly increase. 

1. Based on the issue, before being converted to ujrah, the ptptn charges a service charge of 3% and the formula used is based on the 'reduced balance' method however, when it is converted to ujrah charges where the percentage is 1% the formula has also been converted to method or formula 'straight line' or 'flat rate'. The difference between these two formulas will often affect the loan installment payment amount.

 

• 'Straight Line' or 'Flat Rate'

This formula will take into account the total loan amount each year in the annual installment payment amount. Examples for the calculation of charges ujrah 1% based on the formula 'Straight Line':

Formula ujrah in PTPTN document

= Approved payment x 1% x Refund Period

Ujrah charge = RM 26000 x 1% (per year) x 15 years(payback period)= RM 3900

Total payable = RM 26000 + RM 3900 = RM 29900

Total monthly payment = RM 29900/180 months = RM 166.11

Refund value = RM 166.11 x 180 months = RM 29899.80

 

• 'Reducing Balance'

This formula will take into account the loan amount each year in the count each subsequent count. An example of a 1% ujrah charge calculation based on the 'Reducing Balance' formula:

Loan amount = RM 26000

Repayment period = 180 months / 15 years

Administrative cost = 1%

Installment back payment = RM 155.60

Refund value = RM 155.60 x 180 months = RM 28008

Based on the example provided, the monthly installment payment using the formula reducing balance is RM 155.60 lower than the current value using the straight line method of RM 166.11 whereas it is using the same percentage and period. The question is why during PTPTN's 3% service charge using the 'reducing balance' formula but in the 1%, PTPTN charge using the 'Straight line' formula? If you see the refund value, there is a surplus of RM 1891.80 by using different formula. Therefore, although the change occurred from the service charge of 3% to ujrah 1%, the PTPTN still benefited from the change of the method.

 

2. The question arises when the repayment period for the ujrah system is extended to 15 years while previously only 10 years. The difference in repayment terms from 10 years to 15 years using different rates will result in higher payment rates. By using the values as in (1), here are calculations for 10 years and 15 years using different methods.

 

• 'Straight Line' or 'Flat Rate'

Sample calculation for 10 years.

Ujrah charge = RM 26000 x 1% (per annum) x 10 years (payback period) = RM 2600

Total payable = RM 26000 + RM 2600 = RM 28600

Total monthly payment = RM 29900/180 months = RM 238.33

Refund value = RM 166.11 x 120 months = RM 28599.60

 

Sample calculation for 15 years 

Ujrah charge = RM 26000 x 1% (per year) x 15 year (payback period) = RM 3900

Total payable = RM 26000 + RM 3900 = RM 29900

Total monthly payment = RM 29900/180 months = RM 166.11

Refund value = RM 166.11 x 180 months = RM 29899.80

 

• Reducing Balance

Sample calculation for 10 years

Loan amount = RM 26000

Repayment period = 120 months / 10 years

Administrative cost = 1%

Total administrative cost = RM 1331.92

Refund of installment = RM 227.77

Refund value = RM 227.77 x 120 months = RM 27332.40

 

• Examples of calculations for 15 years

Loan amount = RM 26000

Repayment period = 180 months / 15 years

Administrative cost = 1%

Installment back payment = RM 155.60

Refund value = RM 155.60 x 180 months = RM 28008

Based on the above calculations, PTPTN has offered a loan of RM 29900 with a term of 15 years and using the 'Straight Line' method. When compared to the highest and least cost, it will result in a difference of RM 2567.60 by simply changing the payment period. This clearly shows that PTPTN remains profitable even though it only changes the payment terms and 3% service charge to 1%.

 

3. The question arises when PTPTN is not transparent in performing their duties whereby the borrower has signed an original contract of 3% and will start paying after they start working on a monthly basis. With a new offer contract with a 1% charge, the PTPTN does not take into account the value paid by the borrower but the formula used will calculate the overall value of the loan. For example, during a 3% service charge, the monthly installment of the borrower is RM 179.55 and he has been paying consistently from 2005 to 2008 amounting to RM 7541.10. The amount that has been amortized should be deducted (RM 26000-RM 7541.10 = RM 18458.90) and this value should be calculated with a 1% charge (RM 18458.90 x 1% x 15 years = RM 2768.84) and monthly payment of only RM 117.93. But with a new contract agreement of 1% ujrahsystem, the PTPTN has calculated the overall value without deducting the borrower's value ((RM 26000 x 1% x 15 years = RM 3900) + RM 26000 = RM 29900) and monthly payment is RM 166.10. This clearly shows that the PTPTN will still benefit despite the change in rates.

2. Breach of trust among players with the leader.

3. The responsibility among player to pay koutu.

4. Give many risk to the both side among player and leader. 

5. There are gharar isu in koutu fund.

6. Concept violation ta'wun were by the player made a late payment to the leader.