Brunei being formally under British rules is a common law jurisdiction, with an independent English based-legal system offering civil appeals as far as the Privy Council in London. An International Business Company (known as an "IBC") is governed by the International Business Companies Order, 2000 (“the Order”). The Order has recently been amended and commenced on 31st January 2005 under the International Business Companies (Amendment) Order, 2003.
Language
An official language is Malay; however English is very widely spoken especially in the business environment.
Taxation
1. No corporate tax, income tax, tax on capital gains or other direct or indirect tax shall be levied, withheld or collected in respect of an IBC or a foreign international company incorporated, converted or registered under this Order in connection with any activity, business, investment or otherwise and without limitation of the foregoing activities:
(a) On or in respect of any dividends or earnings attributable to any share, debt or securities of an IBC or a foreign international company: (b) On or in respect of any dividends, interest or other returns from any shares, securities, deposits or other borrowings of an IBC or a foreign international company or any assets managed by an IBC or a foreign international company. 2. No estate, inheritance, succession or similar tax shall be levied in respect of any shares, securities or assets of an IBC or a foreign international company or in respect of the transfer of any such shares, securities or assets. 3. Notwithstanding anything in the Stamp Act (Chapter 34) duty shall not be chargeable on any of the following:-
(a) instruments relating to transfers of any property to or by an IBC or a foreign international company; (b) instruments relating to transactions in respect of the shares, debt obligations or other securities of an IBC or a foreign international company; (c) instruments relating in any way to the assets or activities of an IBC or a foreign international company. 4. If, with respect to any goods imported or to be imported by an IBC or a foreign international company, the Minister is satisfied:- * that the goods are not being made or manufactured in Brunei Darussalam; * that the goods are essential as equipment or fixtures for the purposes of conducting international business in Brunei Darussalam and will be used exclusively for those purposes; and * that the IBC or a foreign international company will notify the Minister prior to the sale, transfer or disposal of the goods (whether within or outside Brunei Darussalam), the Minister may by order exempt the IBC or a foreign international company from all, or so much as he considers appropriate, of any customs duty which would otherwise be levied in respect of the goods. 5. The exemption from taxes and duty conferred on an IBC or a foreign international company on (1) to (3) above may, at no extra charge, be evidenced by a certificate issued by the Minister confirming that the IBC or a foreign international company is so exempt; and without prejudice to the possibility of the issue of a further such certificate, any such certificate shall be valid for a period of 10 years from the date thereof. 6. No filing, return or financial information shall be required from an IBC or a foreign international company in relation to any taxation, duty or other levy in respect of which relief is granted under this section.
Shareholders
A minimum of one shareholder is required and there is no residency or nationality requirement.
Directors
One and there is no residency or nationality requirement. Corporate directors are permitted. Local directors are optional.
Annual Returns
Whilst Brunei currently has double tax treaties with Indonesia and a limited one with the United Kingdom it is unlikely that the IBCs will enjoy tax benefits under these treaties.
Secrecy
Brunei adopts strict money laundering legislation under which all licensed service providers are required to establish the identity of their clients and the business activities proposed to be carried out. Failure to do so will be an offence under the legislation and subject to hefty penalties if found to be guilty. Therefore, full disclosure of beneficial ownerships and proposed business activities will be made to trust companies, registered agents, banks, insurers, etc. but not to the Authority.
Local Requirements
As a matter of local company law the company MUST maintain a registered office address and registered agent within Brunei and must also appoint a company secretary who, for practical reasons, must be resident in Brunei. We would normally provide these services as part of our domiciliary service fee.
