Auctioning on commission

Question

Question: (1) A dear friend of mine has opened a commission firm dealing in fruit and the like; that is, they are commission agents: the goods that people bring to their commission shop for sale, they sell by having their employees call out bids on them. The trader whose bid is for the highest amount, and at which the owner is willing to hand over the goods, — the bidding is closed in the name of that buyer (trader) and the goods are given to him. Then, taking that money, they pay it to the owner of the goods.

Answer

(1) It is permissible. (2) This is not interest; rather it is a brokerage wage, which al-Shami states to be valid. (3) This money has entered into one’s ownership; according to the rules of the Shari‘a, zakat will be due on it just as on other owned money.

Source: Fatawa Mahmudiyya

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