A QUICK LOOK AT...
Brunei is strategically located in the heart of South-east Asia and the country is flanked by premier financial services centres such as Hong Kong, Singapore and Kuala Lumpur. Being a former British protectorate, Brunei’s judiciary system is based on the English Common Law, thus making it a familiar turf for global players. The sultanate has always been known as one of the wealthiest nations due to its vast hydrocarbon resources. With a population stands at around 415,000, its people enjoy a standard of living that is among the highest in the world in terms of per capita GDP.
In recent years, increased emphasis has been placed for economic diversification and the government is focused on making the most of ASEAN’s recent surge in growth by attracting foreign direct investment. Brunei enjoys one of the most liberal tax regimes in the region. Attractive incentives in the form of tax exemption between 5 and 20 years are available for investor for pioneer industries in the form of corporate tax relief, exemption from import duties tax, machinery, equipment and adjustments of capital allowances and losses.
GENERAL INFORMATION
Time Zone: GMT +8 hours
Geography: Situated on the north-western coast of Borneo, with a total area of 5,765 sq. km, borders the Malaysian state of Sarawak and the South China Sea
Capital City and Business Centre: Bandar Seri Begawan
Accessibility: Most South-east Asian key regional cities, as well as Hong Kong, Shanghai, Dubai and London
Language: Malay language (official). English is widely spoken and the language of business
Government: Constitutional sultanate (Malay Islamic Monarchy as guiding principle)
Legal System: Based on English common law with a parallel Shariah law
Exchange Control: No
Currency: Brunei Dollar (B$) at par with Singapore SGD
Economic Activities: Dominated by oil and gas industry, SMEs are well flourishing, ICT and tourism sectors are developing
Tax Treaties: ADTAs with the UK, Indonesia, China, Singapore, Vietnam, Bahrain, Oman, Japan, Pakistan, Malaysia, Laos, HK SAR, Kuwait, Qatar, UAE, South Korea, Luxembourg and Cambodia
Banking: Good with the presence of regional and local banks
TIEAs: with Australia, Canada, India and the Nordic Countries
AEOIs: Yes
Other Service Providers: Small but mature with presence of long established legal and accounting firms
IMPORTANT FEATURES OF SENDIRIAN BERHAD COMPANY (PRIVATE LIMITED COMPANY)
Legislation: Companies Act (CAP. 39)
The Authority: Registrar of Companies (ROC) within the Ministry of Finance and Economy (MOFE)
Types of Company: Limited by shares. All private companies name must end with the words “Sendirian Berhad” or its abbreviation “Sdn Bhd” to denote its limited by shares company
Restriction on Activities: May carry out any business that is lawful in Brunei either in, from or through the country. Financial services and activities require licensing from the Autoriti Monetari Brunei Darussalam (AMBD)
Corporate Tax: Headline tax of 18.5% for companies incorporated or registered as foreign branch under the Companies Act (CAP. 39). Corporate tax exemption is available for the first 3 consecutive years of assessment for newly incorporated companies as follows –
- first B$100,000 of assessable income is exempted from tax;
- 50% of the next B$150,000 of assessable income is chargeable at 18.5%; and
- the full amount of the remaining assessable income is chargeable at 18.5%.
Tax of 55% for companies engaged in the exploration and production of oil and gas
Exemption from corporate tax if gross sales/turnover during the basis period is less than B$1 Million
Certain specific industry tax incentives are available
Withholding Tax: Yes
Personal Income Tax: No
Value Added Tax: No
Sources of Tax Law: Income Tax Act (CAP. 35), Income Tax Act – Petroleum (CAP. 119)
Capital Requirement: Minimum paid-up capital of B$2.00 and minimum authorised capital is B$25,000.00
Currency of Capital: Brunei Dollar (B$)
Registered Office: Required
Shareholders: Minimum of 2 shareholders, they can either be individual or corporation. No residency requirement and 100% foreign owned is allowed
Directors: Minimum of 2 directors, at least one must be ordinarily resident in Brunei. If more than 2 directors, at least 2 of them must be ordinarily resident
Company Secretary: Not mandatory
Registered Office: Local registered office and physical addresses are required (no PO box). Statutory books of the company must be maintained at the registered office
Annual Fees Payable: Only pays the capital registration fee on incorporation. No annual recurring government fee
Public Records: Limited, by way of an extract via company search at the ROC BN portal
Register to Maintain at its Registered Office:
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Register of Directors (Form X)
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Register of Members
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Register of Secretaries
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Register of Director's Shareholding
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Register of Controllers
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Register of Nominee Directors
Company Accounts: 1st accounts must be prepared and adopted within 18 months from the date of incorporation and every subsequent 12 months thereafter. Accounts must be kept at the registered office
Audited Accounts: Not mandatory if all shareholders individuals, the shareholders consist of less than 20 and if the revenue in a financial year is less than B$1 Million (for financial year which is less than 12 months, the revenue shall be proportionately adjusted)
Incorporation Time: 2 business days
Company Meetings: Every company is required to hold an Annual General Meeting (“AGM”) of the shareholders to adopt the accounts. The first AGM must be held within 18 months from the date of incorporation and thereafter, an AGM must be held once in every calendar year and not more than 15 months from the date of the last AGM. In addition, the accounts tabled at the AGM must not be more than 6 months from the date of financial period
Common Seal: Not required
Annual Return: Yes
Tax Return: Yes
Online Incorporation: Available, via One Common Portal (OCP) ocp.mofe.gov.bn
Please note that whilst considerable care has been taken to ensure the information contained within this page is accurate and up to date, no warranty is given as to the accuracy or completeness of any information and no liability is accepted for any errors or omissions in such information. The information given in this page is based on our present understanding of the current laws, guidelines and regulations and may therefore be subject to change without notice.
Information provided by © HMR Konsultan (UPDATED Mar2021)