Potential Shariah Non-Compliance Practices in E-Bidding: Observation from E-Bidding Platforms in Malaysia

Abstract

E-bidding has gained popularity in the modern world due to the technology advancement. Despite its popularity, contracting parties are exposed to Shariah non-compliance practices, which may lead to financial losses and disputes. Islamic jurisprudence provides guidelines assisting bidders and auctioneers in avoiding these practices. This study examines e-bidding platforms in Malaysia and highlights potential Shariah non-compliance issues based on Islamic jurisprudence guidelines. This study employs a qualitative data analysis method. Data are collected from the e-bidding platforms and their published documents. The findings revealed several practices that might lead to Shariah non-compliance issues in e-bidding platforms, including unverified bidders, elements of uncertainty, riba, gambling, and unavailability of khiyar (option). This study suggests several improvements to enhance procedures of e-bidding platforms to avoid financial losses and disputes among contracting parties in e-bidding. Hence, the improvement like verification of bidders, fulfilment of requirement for trading ribawi item, avoidance of element of uncertainty and gambling activities, and offering khiyar to successful bidder are suggested.