What is the ruling on buying from the kuffaar when there are Muslims around?

What is the ruling on Muslims who do not cooperate with one another because they do not want to buy from Muslims and they prefer to buy from the kuffaar’s stores? Is this halaal or haraam?

Praise be to Allaah.

The basic principle is that it is permissible for a Muslim to buy what he needs of that which Allaah has permitted from a Muslim or from a kaafir. The Prophet (peace and blessings of Allaah be upon him) bought  from Jews. But when a Muslim chooses not to buy from his Muslim brother for no reason, i.e., he has not been cheated or deceived, and the goods are not of poor quality, and he simply prefers to buy from a kaafir rather than from a Muslim with no justification – this is haraam, because it weakens the trade of the Muslims and makes them lose sales if this becomes a habit among the Muslim (consumers). But if he does not buy from him for a reason such as those mentioned above, then he should advise his Muslim brother to give up the bad things he is doing. If he accepts the advice, then praise be to Allaah, otherwise he should leave him alone and go to someone else, even if he is a kaafir, if he is honest and the transactions are to the mutual benefit of both parties.

From Fataawaa al-Lajnah al-Daa’imah, 13/18
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