It was intended as an improvement on the Iltizam system, in which a tax-farmer was responsible for a single year.
However, vested interests - from existing mültezims who benefited from the Iltizam system - prevented wider adoption of malikâne.
A malikâne tax-farm, typically for a village or district, would be auctioned to the highest bidder; in return for collecting all state taxes (rüsüm) from that area,[2] the winner of the auction would make a large downpayment called muaccele, and then annual payments called mâl.
The auction determined the initial payment - subject to a minimum price set by the treasury.
A malikaneci might finance their initial payment by borrowing from a moneylender or sarraf - who would expect to take a cut of the tax revenue; this could even become a second layer of tax-farming.