Purchasing and Selling Domain Names
Fatwa No: 534583

Question

About ten years ago, I entered a profit-sharing partnership with my younger brother regarding the purchase and sale of premium domain names. He provided the capital and I provided expertise and guidance. We agreed on a specific share of profits for me, but after profits were realized, he paid only half of my agreed share while acknowledging that the original agreement existed. He now offers various reasons for reducing my share.
What is the Shari'ah ruling on withholding an agreed share of profits?

Answer

All perfect praise be to Allah, The Lord of the Worlds. I testify that there is none worthy of worship except Allah, and that Muhammad is His slave and Messenger.

A domain name is the address through which a website is accessed. There is no harm in trading in it, as this falls under the category of ijārah (leasing), which is the sale of a benefit or service. So, whoever leases a domain name has thereby come to own its benefit, and it is permissible for him to sell this benefit to someone else. This is the ruling in general terms.

As for a partnership in which the capital comes from one party and the labor from the other, this falls under muḍārabah partnership (a profit-sharing partnership in Islamic finance), with the profit divided between the two parties according to whatever they have agreed upon. Ibn Qudāmah states in his commentary on Al-Muqni': "(The profit is according to whatever the two parties have mutually agreed upon) –  meaning, in all types of partnership. And there is no disagreement on this point in muḍārabah." (End of citation)

This covers the ruling on trading in this field in general. As for the specific matter between you and your brother, we are not able to give a definitive ruling on it, since disputed matters cannot be properly adjudicated except after hearing the statements of all parties involved. However, if what you have described is indeed what actually occurred, then your brother has no right to wrong you by reducing your share of the profit contrary to what you both agreed upon.

Furthermore, you are entitled to demand from him whatever has been withheld, and this remains a debt owed by him to you until he pays it back to you – unless you choose to forgive him for it.

Allah Knows best.

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