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OSAS-WAK™ · Shariah Advisory Standard

Wakālah Approval Framework

A contract in which a principal (Muwakkil) appoints an agent (Wakīl) to perform a defined act on the principal's behalf, with or without a fee. Widely used in investment management, takāful operations, treasury and corporate finance mandates.

OSAS-WAK™ · وَكَالَة
Advisory Dossier

OSAS-WAK™ — Approval Memorandum Template

Section 1 — Parties & Scope

Principal (Muwakkil)
—
Agent (Wakīl)
—
Agency Scope
Investment / Takāful / Treasury / Advisory

Section 2 — Fee & Authority

Agency Fee
Fixed / Performance / Hybrid
Authority Limits
Asset classes, geographies, single-name limits

Section 3 — Shariah Opinion

Decision
Approved / Conditional / Rejected
Shariah Adviser
Full name & registration
Compliance Checklist

Essential vs Prohibited Elements

Essential Conditions (must hold)

  • Subject matter must be clearly defined and Shariah-permissible
  • Agency scope, authority limits and duration are documented
  • Agency fee may be fixed, performance-linked, or combination — but must be unambiguous
  • Agent owes the principal a fiduciary duty (amānah)
  • Profit (if any) belongs to the principal; agent earns only the agreed fee
  • Agent is liable for misconduct, negligence and breach of mandate

Prohibited Elements (must absent)

  • Guaranteed return to the principal from the agent
  • Open-ended authority without defined scope
  • Self-dealing by the agent without explicit principal consent
  • Combination of agency fee with profit-sharing in a way that obscures fiduciary roles
Transaction Layout

Step-by-Step Flow

OFIS-WAK™ · Transaction Flowوَكَالَة · AGENCY CONTRACT1Mandate Definition
Define scope, authority, performance benchmarks and exclusions.
2Fee Structure
Agree fixed fee, performance fee or hybrid; document calculation.
3Execution
Agent executes within mandate; maintains evidence of compliance.
4Reporting
Periodic reporting to principal with audit trail.
5Settlement
Profit returned to principal; fee paid to agent per contract.
6Termination
Either party may terminate per agreed notice; outstanding obligations settled.
REVIEWED UNDER OFIS-WAK™ · AAOIFI SHARIAH STANDARD NO. 23 — AGENCY
  1. 1

    Mandate Definition

    Define scope, authority, performance benchmarks and exclusions.

  2. 2

    Fee Structure

    Agree fixed fee, performance fee or hybrid; document calculation.

  3. 3

    Execution

    Agent executes within mandate; maintains evidence of compliance.

  4. 4

    Reporting

    Periodic reporting to principal with audit trail.

  5. 5

    Settlement

    Profit returned to principal; fee paid to agent per contract.

  6. 6

    Termination

    Either party may terminate per agreed notice; outstanding obligations settled.

Documentation Required

Standard Document Set

Wakālah Agreement
Investment / Operating Guidelines
Fee Schedule & Calculation Methodology
Reporting Template & Frequency
Conflict-of-Interest Policy
Shariah Adviser Approval Memorandum
Shariah Opinion

The proposed Wakālah structure is reviewed and found compliant with applicable Shariah principles subject to the conditions stated herein.

Approved
Conditional Approval
Rejected

Reviewed under OSAS-WAK™ · AAOIFI Shariah Standard No. 23 — Agency
Reviewed and Approved by Abdul-Azeez Onike Morufu — Registered Shariah Adviser, Securities Commission Malaysia

Related Structuring Framework
OFIS-WAK™ — Wakālah
Open OFIS framework
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OSAS™ · Onike Shariah Advisory Standards

Reviewed and Approved by Abdul-Azeez Onike Morufu — Registered Shariah Adviser, Securities Commission Malaysia

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