Company registration in Brunei

Brunei has a strategic location in the Region of Southeast Asian. The local government has created favourable conditions for doing business and attracting investments. The state is developing dynamically and may appear to be highly beneficial if you intend to enter respective markets. This can be done in one of the next ways.

Forms of Legal and Business Presence

If you intend to become present in Brunei, you may set up your business in one of these major forms:

• Limited Liability Company – a commercial vehicle that is legally separated from its founders and is considered as the most popular form for arranging business presence in Brunei. The liability of founders (shareholders) in this case is restricted to (1) the value of the invested property (in this case the company is limited by shares) and (2) the value of guarantee – an extra amount the shareholders agree to contribute for covering potential losses (in this case the company is limited by a guarantee).

  The limited liability company may be also either (i) private where the number of shareholders is from 2 to 50 and certain restrictions for the share transfers are applied or (ii) public where there should be at least 7 shareholders and shares can be freely offered to the public. In each case, two directors are required at least to establish a vehicle. The obvious benefit of the limited liability company is that there are no minimum thresholds for the statutory capital. Still, the types of commercial activities that will be carried out further should be taken into consideration too, especially if these are licensed ones.

• Unlimited Company – in this case, the shareholders bear the entire risks for the results of the company's operation. Their personal property also may be called to cover potential losses. This type of vehicle also may be private or public with the same approaches applied to the limited companies: (1) a private unlimited company should have from 2 to 50 shareholders and cannot offer shares to the public, alternatively (2) a public unlimited company should have at least 7 shareholders and its shares can be publicly-offered.
• Partnership – it may be established by permanent residents and citizens of Brunei. This commercial formation can be registered by two partners at least. The number of partners should not be more than 20. Otherwise, partners have to incorporate a legal entity. Business partners are entirely responsible for all results of the partnership’s operation and all business activities carried out by it.
• Branch – this type of business formation of a foreign company can carry out the same type of commercial activities in Brunei after its registration.
• Representative Office – a formation that cannot carry out business in Brunei but can promote the activities of a respective foreign company and makes it easier to elaborate on workable solutions on how to benefit from running a business in Brunei.

Registration Requirements and Steps

Company incorporation in Brunei, a limited liability company, for instance, may be completed after passing these basic steps:

1. Defining your business priorities in the Region.
2. Creating, verifying and reserving a business name for a prospective commercial vehicle.
3. Collecting data about founders, beneficial owners and management of the future entity.
4. Arranging the registered office for the future entity.
5. Preparing and formalizing the Memorandum and Articles of Association for a future company.
6. Forming and lodging the package of registration documents to legally establish a new entity.
7. Creating a seal and stamp for the future entity (optional).
8. Registering for tax and social security purposes.
9. Opening a corporate bank account for a newly-incorporated entity.
10. Obtaining licenses and permits (may be required for certain types of commercial activities you are going to conduct).

This registration procedure is preliminary only. It may slightly vary taking into account your concrete conditions. Prifinance specialists consider entirely all peculiarities on a case-by-case basis.

Legal and Regulatory Framework

Brunei creates and enhances favourable conditions for running a business permanently. This is ensured through the simplifying of the procedures for establishing entities and encouraging foreign direct investments. There is even a separate authority – Brunei Economic Development Board (BEDB) – that promotes investments and commercial activities of foreign investors in Brunei.

The Companies Act is a major legislative act regulating the process of establishing and operating companies in Brunei. The Ministry of Finance that holds the Registry of Companies and Business Names (ROCBN) is the principal state authority the founders should deal with when incorporating a business vehicle. In certain cases, obtaining licenses may be required, like for banking, insurance companies, for offering financial services, etc.

Advantages of the Jurisdiction

If you consider an option of the company registration in Brunei, this may be promising in view of the following benefits the jurisdiction offers:

• Stable and well-developed local economy
• Strong regional connections in the Southeast Asia Region
• Advantageous conditions for doing business, including plenty of double-tax treaties
• Opportunity to incorporate a commercial vehicle in the Brunei free trade zone
• Well-developed oil and gas industries as well as new industries (communications, technologies)
• High social standards
• Qualified workforce

Tax System of Brunei

• Corporate income tax rate (basic) – 18.5 %
• Personal income tax rate – 0 %
• VAT – not applicable
• Withholding tax rates – (i) dividends - 0%, (ii) interests - 2.5%, (iii) royalties - 10%.
• Capital gains tax rate – 0 %

How Prifinance Specialists May Assist You

If you intend to create a company in Brunei, Prifinance specialists may consult you more precisely whether this option can be promising to fulfil your concrete business goals as well as to offer you alternatives. Our professionals will prepare all required documents, consult you preliminary on the amount of taxes due and help with resolving other business-related matters that may arise. We will also open a bank account for a newly-founded corporate entity and support its commercial and trade activities in the Region further. Reach us shortly for more detailed suggestions and discussions.