AN APPRAISAL OF COMPARATIVE ANALYSIS OF (GHARAR UNCERTAINTY, RISK, DECEIT, AND SPECULATIVE) IN TRANSACTION UNDER ISLAMIC LAW AND COMMON LAW

Abstract

This paper presents a comparative analysis of the concepts of Gharar (uncertainty, risk, deceit, and speculation) in Islamic Law and Common Law. Gharar, a fundamental concept in Islamic finance, is examined in its various dimensions to understand how it is translated and interpreted within the frameworks of both legal systems. The study explores the origins and definitions of Gharar in Islamic jurisprudence, focusing on its implications for financial transactions and contracts. It also delves into the principles of risk and uncertainty in Common Law, highlighting the differences and similarities in their treatment and regulation. The analysis reveals that while both legal systems aim to ensure fairness and transparency in economic activities, their approaches to managing uncertainty and risk differ significantly. Islamic Law emphasizes the prohibition of excessive uncertainty and deceit to promote ethical financial practices, whereas Common Law tends to accept a certain level of risk and speculation as inherent to market operations. The study also addresses how these differences impact the enforceability and interpretation of contracts, with Islamic Law prioritizing the prevention of unjust enrichment and exploitation, and Common Law focusing on balancing interests and economic efficiency. By comparing Gharar with the principles of risk and deceit in Common Law, this paper sheds light on the underlying philosophical and practical distinctions between the two legal systems. The findings underscore the importance of contextual and cultural factors in shaping legal norms and highlight the potential for cross-jurisdictional learning and adaptation. This comparative analysis not only enhances the understanding of Gharar but also contributes to broader discussions on legal pluralism and the harmonization of international financial regulations