Benefactors can use the Waqf Fund to receive units of the fund and the fund manager on behalf of them buys shares and spends their profits on charitable affairs.
Majid Pireh, Secretary of jurisprudential committee of SEO, addresses the issue of capital market’s capacities to achieve benevolent goals then this question was raised whether capital market capacity could be used for those who intend to participate in charitable activities.
He mentioned that Waqf means the confinement of an asset in which its benefits are spent in line with the intentions of the benefactor (someone who does Waqf), adding the increase of properties price in recent years has caused the use of capital market’s capacity for Waqf and its development and contribution to those who want to do Waqf to be raised. Hence, the capital market’s capacity can pave the way for many benefactors toward achieving their benevolent objectives with their micro-capital.
Secretary of jurisprudential committee of SEO stated that establishing a Waqf Fund in the capital market is to cover the benevolent intentions of individuals, so a fund is established for specific purposes such as development of religious sites, construction or development of health centers, school construction and so on. The fund manager after obtaining necessary permits from the relevant institutions, issues the fund units.
Pireh said benefactors who intend to participate in Waqf will receive the fund units by providing their financial resources to the fund manager then he purchases an asset which is eligible for Waqf on behalf of the fund units’ owners to dedicate it for special purposes stated in the fund’s statute.
‘The fund units’ owners jointly dedicate something and the fund manager dedicates it on behalf of them after purchasing a certain asset’ he said.
Secretary of jurisprudential committee of SEO stressed that an asset purchased by the fund manager based on establishing Waqf Fund is called share, but each share doesn’t have a feature of endowment (Waqf) in the capital market. He reiterated a share has a feature of Waqf that a corporate’s physical assets outweigh its other assets.
Pireh highlighted that there is a Shariah observer in the structure of the Waqf Fund.