Derivatives
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November 4, 2021
Derivatives
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November 4, 2021

Arabic (العقود التبعية) for accessory contracts/ documentation contracts. Under shari’ah (Islamic law), accessory contracts are contracts (uqud/ pl. of aqd) which do not exist by their own and are not independent of other contracts. These contracts do require the existence of another contract (other contracts) as a perquisite for them to come into existence. The essential purpose of such contracts is documentation and safeguarding of contractual rights. Examples of uqud taba’yyeah include rahn (collateralization), kafalah (suretyship), hawalah (assignment/ transfer of debt), and wakalah (agency or proxy).

These contracts are also referred to as uqud al-tawthiqat (عقود التوثيقات).

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