E-commerce Transactions in Islam: Fiqh Muamalah on The Validity of Buying and Selling on Digital Platforms

TL;DR

This paper examines the Sharia compliance of various e-commerce practices in the Muslim community, identifying which transactions are valid or invalid and proposing a comprehensive Sharia audit for digital platforms.

Contribution

It provides a detailed normative analysis of common e-commerce transactions under Islamic law and suggests restructuring methods and a Sharia audit framework for digital economy compliance.

Findings

Dropshipping and PO are invalid if conducted with direct sale contracts.

Conventional BNPL contains riba and is non-compliant.

Digital representations and algorithms often violate Sharia principles.

Abstract

The development of the digital economy has established e-commerce platforms as the primary space for commercial transactions for the Muslim community. However, innovations in features and business models on these platforms have gave rise to Sharia issues that cannot be fully explained through conventional Fiqh Muamalah contract frameworks. This research aims to examine the compliance of transaction practices in e-commerce with Sharia principles, particularly in the six most frequently used transaction forms, namely information arbitrage-based dropshipping, Buy Now Pay Later financing schemes, digital representations, algorithmic marketing that encourages consumptive behavior, halal verification, and Pre-Order systems. The research method used is a Critical Literature Review with a normative juridical approach, through the study of arguments from the Qur'an, Hadith, DSN-MUI Fatwas, as well as classical and contemporary fiqh literature. The results show that dropshipping and PO practices are considered invalid if conducted with a direct sale contract (bai') due to the nonfulfillment of the element of possession (qabd) and the presence of high uncertainty (gharar). Both practices can be justified through the restructuring of contracts into wakalah bil ujrah, salam, or istishna'. Conventional BNPL is declared non-compliant with Sharia because it contains riba nasiah and riba qardh. Misleading digital representations and halal claims without valid verification fall into the category of tadlis, while dark patterns based algorithmic marketing contradicts maqashid al-syariah, especially the protection of wealth (hifz al-mal) and intellect (hifz al-'aql). This research emphasizes the need for a comprehensive Sharia audit covering contract legality, algorithmic ethics, and interface design to realize a digital economic ecosystem that is fair, transparent, and in accordance with Islamic Sharia.