Treasury Stock and Its Relevant Theoretical Challenges

• Main Authors: Sayyed Morteza Shahidi, Nasrollah Jafari Khosroabadi
• Format: Article
• Language: fas
• Published: Imam Sadiq University 2016-10-01
• Series: تحقیقات مالی اسلامی (پیوسته)
• Subjects: treasury shares; redemption of shares; share acquisition; reduction and depreciation of capital
• Online Access: http://ifr.journals.isu.ac.ir/article_1920_6961dbfcdad96f525f13decf8fb74a07.pdf
• ISSN: 2251-8290; 2588-6584

Treasury stock in its particular sense is a stock which has been repurchased, owned and maintained by the issuer for the purpose of being offered in the future. Few countries have recognized this and our country has recently adopted it. Despite its economic and financial justifications, it is not justified by legal analysis. This paper, based on a descriptive/ analytical analysis, has reviewed various pertinent views about the stock nature, and has criticized it according to Islamic law principles. It seems this stock is not justified on the basis of any of the common views about the nature of stock and it is to be considered as an expropriation or detention of property ownership. However, based on the opinion of a group of scholars who have recognized the stock as a common ownership of the company capital, the ownership of shares by the company itself can be justified.