Islamic Laws

Muslims in Islamic societies have traditionally viewed Islamic law as essential to their religious outlook. For Muslims living in secular Western countries sharia ceases to be relevant as law, but remains a source of personal ethics (for example, the avoidance of pork and alcohol, and the use of Sharia-compliant banking services). The Qur'an is the foremost source of Islamic jurisprudence; the second is the Sunnah (the practices of the Prophet, as narrated in reports of his life). The Sunnah is not itself a text like the Qur'an, but is extracted by analysis of the Hadith (Arabic for "report") texts, which contain narrations of the Prophet's sayings, deeds, and actions of his companions he approved.

One hadith of special importance for Islamic contractual law should be mentioned here. A merchant named Hakim ibn Hizam reported, "I asked the Prophet: O Messenger of Allah! A man comes to me and asks me to sell him what is not with me, so I sell him and then buy the goods for him in the market. And the Prophet said: sell not what is not with you." This hadith has rendered controversial within the Muslim world much of what is considered routine finance outside of it, including the sale of futures and options, both of which might be characterized as the sale of 'what is not with you.'

In recent times, traditional Islamic law has often been questioned by liberal movements within Islam. In a related development, Mohammad Hashim Kamali has questioned the reliability and contemporary relevance of the above quoted hadith of Hakim ibn Hizam.