Quran sets a strict inheritance system and only 1/3 of the propety can be appointed by the person. So how can you preserve successful enterprises across generations? Doesn't sharia inheritance lead to small enterprises and lower economic output, as it hinders the preservation of successful enterprises? It has been argued this fragmentation of property is one of the main reasons of the eventual downfall of the Islamic world - How can God's law be imperfect?
Is it possible to preserve successful enterprises in Islam?
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ardianto
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Implementation for inheritance in Islamic law actually is not strict because a heir can choose to not take his heritage and give it to another heir. In example, according to Islamic law, the son get bigger share than the daughter. But when my parents passed away, me and my brother chose to not take all of my share, but gave some of it to our sisters. So, all children in the family got same share regardless the gender.
Also, properties that already granted, or planned to be granted to the chosen heirs, are not included in the object of inheritance. In example, a businessman has two children and two business companies. He made a testament that the company "A" will be given to the first child, company "B" will be given to the second child. Then when this businessman died, the company "A" belong to the first child, the company "B" belong to the second child, and not included in the heritage that will be shared among the heirs.
Also, properties that already granted, or planned to be granted to the chosen heirs, are not included in the object of inheritance. In example, a businessman has two children and two business companies. He made a testament that the company "A" will be given to the first child, company "B" will be given to the second child. Then when this businessman died, the company "A" belong to the first child, the company "B" belong to the second child, and not included in the heritage that will be shared among the heirs.
What if the other heirs don't want to cooperate? It surely creates unnecessary obstacles and fragmentation. It would make much more sense to distrubute the property according to merit by the person making the testament.
Also, is it really possible to just rearrange the inheritance that easily? Is it not trumping with God's law?
Right, but isn't the amount you can choose to distrubute as you like only 1/3 of your wealth?
ardianto
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Implementation of Islamic law of inheritance is not as rigid as your assumption. For the heirs, heritage is the right, not obligation. A heir can choose to not take the heritage, and give it to another heir. And with agreement of heirs, the portion of heritage that will be distributed can be rearranged. It's not against law of Allah because it's allowed under the consent of the heirs. What not allowed is if a heir take another heir heritage without permission from this another heir.
About business enterprise. A businessman can pass down the company to his heirs without liquidate it, and then give it in form of money. But he can pass down the company to few heirs at once in the form of shares. So the company still exist although the owner are more than one.
About business enterprise. A businessman can pass down the company to his heirs without liquidate it, and then give it in form of money. But he can pass down the company to few heirs at once in the form of shares. So the company still exist although the owner are more than one.
1/3 is maximum amount that can be given to one person. But this rule does not valid for hibah (grant) that given when the person who give it still alive. And also, if other heirs agree, one heirs can take more than 1/3.