Legal quagmire when a fatwa does not apply to companies but a ruling does — Hafiz Hassan

Malay Mail

21-06-2025

JUNE 21 — According to Article 160(2) of the Federal Constitution, law includes written law, which in turn comprises federal law and state law.
Federal law includes legislation made by Parliament (Acts), while state law consists of legislation enacted by the State Legislative Assemblies (Enactments or Ordinances).
A fatwa is both federal and state law. It is federal law when issued under the Administration of Islamic Law Act, and it is state law when made under the respective Enactments or Ordinances of each state — but law nonetheless.
A fatwa (plural: fatawa) in Islamic jurisprudence is a formal ruling or interpretation on a point of Islamic law, issued by a qualified legal scholar (mufti) in response to a specific question posed by an individual (mustafti).
The ruling is a practical application of Islamic law to a particular issue and is given after the mufti has engaged in ijtihad to reach a legal conclusion.
Ijtihad refers to the process of striving to derive legal rulings from the primary sources of Islamic law — the Quran and the Sunnah — when a clear and direct ruling is not available. It involves a comprehensive understanding of Islamic legal theory (usul al-fiqh) and the ability to apply it to new or emerging issues.
The relationship between ijtihad and fatwa is this: ijtihad is the methodology; fatwa is the product. A mufti uses ijtihad to formulate a legal conclusion, which is then issued as a fatwa.
Although considered authoritative, fatwas are generally not binding and typically serve as advisory opinions.
Under Malaysian law (Acts, Enactments or Ordinances), a fatwa is defined as a ruling on any unsettled or controversial question related to Islamic law. No statement made by a mufti shall be deemed a fatwa unless and until it is published in the Gazette.
Once published, a fatwa is binding on every Muslim resident in the relevant territory or state as a dictate of their religion, and it becomes their religious duty to observe and uphold the fatwa — unless Islamic law allows personal deviation in matters of belief, observance or opinion.
A fatwa is also recognised by the Shariah courts as authoritative on all matters addressed within it. (See, for example, Section 34 of the Administration of Islamic Law (Federal Territories) Act 1993.)
By definition, a Muslim is a person who professes the religion of Islam. A person, in turn, includes a body of persons, corporate or unincorporated. (See Section 3 of the Interpretation Acts 1948 and 1967.)
Federal law includes legislation made by Parliament, while state law consists of legislation enacted by the State Legislative Assemblies. — Picture by Yusof Mat Isa
Another product of ijtihad is what is otherwise referred to as a ruling under the law.
Take, for example, the rulings issued by the Shariah Advisory Council (SAC) of Bank Negara Malaysia (BNM).
The SAC was established in May 1997 as the highest Shariah authority for Islamic financial institutions in Malaysia.
Its roles and functions as the authoritative body for the ascertainment of Islamic law in the context of Islamic finance — which is supervised and regulated by BNM — were reinforced with the enactment of the Central Bank of Malaysia Act 2009 (CBA). (See Sections 51 and 52 of the CBA.)
The SAC plays a pivotal role in ensuring the consistent application of Shariah rulings across Islamic financial institutions. These rulings serve as the primary reference to ensure end-to-end Shariah compliance in the structuring and implementation of financial products and activities.
Crucially, Section 57 of the CBA makes these rulings binding on Islamic financial institutions.
Furthermore, Section 58 of the CBA provides that SAC rulings 'shall prevail' over any ruling made by a Shariah body or committee of an Islamic financial institution.
And so we arrive at this paradox: following the majority decision of the Federal Court in the Sisters in Islam Forum fatwa case, one product of ijtihad (a fatwa) does not bind companies, but another (a ruling) does.
The majority reasoned that only a natural person can profess the religion of Islam. However, the judgment did not address the definition of 'person' under Section 3 of the Interpretation Acts 1948 and 1967. (As noted above, 'person' includes corporate entities.)
We respect the decision of the majority. But after years of legal proceedings, it is humbly submitted that we are not yet out of a legal quagmire.
* This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.