Paid agency (wakalah bil ujrah)
An agency in which the agent is paid a fee; the fee must be known, and the arrangement follows the rules of ijarah.
Paid agency is a wakalah in which the agent receives a fee for its service. AAOIFI's agency standard says paid agency is permissible whether the fee is stated in the contract or established by custom, that it falls under the rules of ijarah, and that the fee must be known, as a lump sum or a share of a specified amount. The agent is still a trustee of what it handles, so the fee does not make it liable for losses that were not caused by its misconduct or negligence.
Sources
This entry explains a term; it is not a Shariah ruling. Approving a product is for each institution's own Shariah board and regulator.
Related terms
WakalahAgency: one party appoints another to act on its behalf, with or without a fee.Ujrah (fee)A fee, wage or rent paid for a service, an agency or the use of an asset; the price side of ijarah and paid wakalah.Wakalah bil-istithmar (investment agency)Investment agency: the agent invests the principal's funds for a fee, and the profit or loss belongs to the principal.Ta'addi and taqsir (misconduct and negligence)Misconduct and negligence: the two grounds that make a trustee, agent or mudarib liable for a loss it would otherwise not bear.Fuduli (uncommissioned agent)A person who deals in another's property without authority; the owner may approve or reject the act.