Dato’ Seri Matthew Yeoh discusses how Islamic financing can be a viable alternative to conventional financing.
OWNERSHIP RIGHTS UNDER ISLAM
Under Islamic law, ownership rights originate from the concept of stewardship of property according to God’s will. This concept is based on the Islamic belief that God owns all property and men are merely trustees or custodians. Thus, traditionally, in Islam, when a State gave land to its subjects, it gave only the right to use the land and not full ownership. However, men are enabled to act for the care of the property and nothing in Islamic law prohibits the use of this property to generate wealth and other capitalistic aims.
Today, these Islamic beliefs continue to guide legislative land codes in Arabic Muslim countries although some governments have adapted their land ownership schemes to have greater control over the country’s political economy and to encourage increased agricultural production.
As it relates to land, the Islamic belief that man serves God when he makes use of property translates into the judicial law that property can be acquired under Islamic law through developing and using land that has been unclaimed by anyone. Generally, under Islamic tenure systems, land is classified into four main categories: milik (individual ownership with full rights); miri (state-owned land to which individuals may gain use rights); waqaf (religious foundation owned land “stopped for God”); and musha (collective or tribal owned land).
Malaysia’s National Land Code (1965) (the Code) offers a clear example of how Islamist beliefs have been incorporated into secular legislative codes. For example, under the Code, the owner of land left idle beyond a certain period is considered to be in breach of an implied condition. If the owner does not develop the land after the authorities notify him of the breach, the government may institute proceedings to forfeit the owner’s rights to the land and may take back the land without recourse from the owner.