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Capital Investment Agreement (Mudarabah)

A printable «Capital Investment Agreement (Mudarabah)» form to fill in by hand: 19 fields, with fiqh notes and sources. Free download, no registration, in Russian, English and Arabic.

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This form has not yet been checked by a scholar. It is a draft drawn from the sources, not an approved specimen: show it to someone knowledgeable before signing.

What the form contains

1. Place and date of conclusion

  • City
  • Date

2. Parties to the contract

  • Rabb al-mal (capital provider / investor): full name
  • Address of the rabb al-mal
  • Mudarib (managing partner): full name
  • Address of the mudarib

3. Subject matter and type of mudarabah

  • Subject matter: field of activity (permissible/halal only)
  • Type of mudarabah: mutlaqah (unrestricted) / muqayyadah (restricted)
  • Restrictions imposed on the mudarib (in a muqayyadah mudarabah)

4. Mudarabah capital and its delivery

  • Amount of capital (in figures and in words)
  • Currency of the capital
  • Method of delivering the capital
  • Date of actual delivery

5. Distribution of profit

  • Share of the rabb al-mal in the PROFIT, %
  • Share of the mudarib in the PROFIT, %

6. Term of the contract and objective of the venture

  • Term: from … to …
  • Or: until the objective of the venture is achieved — state the objective

7. Reporting and final provisions

  • Manner and frequency of reporting
  • Other provisions
★ Losses are borne by the rabb al-mal (the capital provider); the mudarib (the managing partner) loses his labour. The mudarib is liable only in the event of misconduct, negligence or breach of the agreed restrictions.
★ A guarantee of the capital given by the mudarib is IMPERMISSIBLE — it converts the mudarabah into an interest-bearing loan.
★ Profit is distributed only after the capital has been fully recovered (wiqayat ra's al-mal — protection of the capital).

Mizan does not issue fatwas and does not replace a scholar. It is not legal advice and gives no contract force under the law of any country. Where the matter is serious, have the contract read by a specialist in Sharia and by a lawyer.