Business entities in Brunei
Most of our Clients are interested to register an international company with the Brunei International Financial Center. Such entities, legally tax exempt in Brunei, are usually used as trading vehicles to do business outside of Brunei. Alternatively, we can also assist our Clients to do business in Brunei by registering a local entity, subject to local tax. Please read the page below for further information available on the different types of business entities available in Brunei, and their best uses.
Doing business outside of Brunei with a local entity
The Brunei offshore company (Brunei IBC company)
- Brunei international business companies can be registered with i) one shareholder ii) one director and iii) a minimum share capital of US$1. Neither the director(s) nor the shareholder(s) are required to be resident in Brunei;
- A Brunei IBC is legally exempt from all taxes in Brunei but can only trade with customers residing outside of Brunei. While it is possible to open a corporate bank account in Brunei, limited corporate banking options are limited so most of our Clients use our international corporate bank account opening services;
- Best uses: a Brunei IBC is a good entity for trading. It is also frequently used as a holding vehicle, although it does not have access to double taxation avoidance treaties. Please refer to the complete Brunei IBC company web page for further details.
The Brunei international limited partnership (Brunei ILP)
- The Brunei international limited partnership consists of general partners, amongst whom at least one must be a licensed entity in Brunei, and limited partners, who can all be foreigners. General partners’ approval is required for all business activities of the partnership;
- Best uses: while we will assist our Clients to register a Brunei ILP if required, Healy Consultants recommends to use Brunei IBCs for most trading and holding activities.
The Brunei offshore trust
- Foreigners can register offshore trusts in Brunei under the Registered Agents and Trustees Licensing Order of 2000. Assets, settlors and beneficiaries must all be nonresidents, while one of the trustees must be a licensed entity in Brunei;
- Trusts in Brunei can additionally apply for charitable status with the local tax authority;
- Best uses: Brunei offshore trusts are attractive for family wealth management and asset protection. They are also commonly used as special purpose vehicles for investment activities in Asia Pacific.
Doing Brunei in Brunei with a local entity
The Brunei limited liability company (SDN BHD)
- The Brunei limited liability company (or Brunei private limited company) requires i) at least 2 shareholders at incorporation, who can be of any nationality and country of residence and ii) only US$1 of share capital. However, half of the company’s directors must be either Bruneians or Brunei permanent residents. If needed, Healy Consultants will be pleased to provide our Clients with a nominee resident director. For further information on this service, please refer to our Brunei resident director page;
- All Brunei LLCs must also submit their annual financial statements to a statutory auditor and then file them with the Ministry of Finance;
- Best uses: Brunei local companies are the most commonly used vehicle to do business with Bruneian residents.
The Brunei free zone company
- Foreigners can register limited liability companies in the single free trade zone of Brunei, the Pulau Muara Besar Free Trade Zone. Such companies can benefit from up to 15 years of tax holidays;
- Best uses: Brunei free zone companies are usually conducting repackaging or light manufacturing activities for products then re-exported in Malaysia, Indonesia, Philippines and Singapore.
The Brunei public limited company (BHD)
- Although the Brunei PLC only requires US$1 of share capital, all its shareholders and half its directors to be Bruneians or Brunei PR;
- All Brunei PLCs must submit their annual financial statements to a statutory auditor and then file them with the Ministry of Finance;
- Best uses: foreigners are usually not interested to setup a Brunei PLC. If our Clients are willing to raise capital, a better alternative is to register a Singapore or Hong Kong PLC.
The Brunei branch
- Brunei corporate law allows foreign companies to open 100% foreign-owned branch office, provided they have 1 resident company secretary and a registered office in Brunei. The scope of operations for this Brunei legal entity will be defined by the parent company. Branch offices in Brunei are subject to standard corporate tax and withholding tax and must file their annual financial statements with the Registrar of Companies;
- Best uses: branch registration is a good alternative for Clients who are not comfortable with the requirement to appoint resident directors when setting up a local limited liability company. However, the foreign company will be subject to unlimited liability against losses and debt incurred by its Brunei branch.
The Brunei representative office
- This entity is not differentiated from a branch.
Table of comparison between Brunei resident entities
|Operations and logistics||Brunei Offshore||Brunei International Partnership||Brunei offshore trust||Brunei LLC||Brunei free zone company||Brunei PLC||Brunei branch|
|Locally known as||IBC||ILP||Offshore trust||SDN BHD||Brunei FTZ||BHD||Branch office|
|Doing business in Brunei permitted?||No||No||No||Yes||Yes||Yes||Yes|
|Allowed to sign contracts with local Clients?||No||No||No||Yes||Yes||Yes||Yes|
|Allowed to invoice local Clients?||No||No||No||Yes||Yes||Yes||Yes|
|Can rent local office premises?||Yes||Yes||Yes||Yes||Yes||Yes||Yes|
|Allowed to import raw materials?||No||No||No||Yes||Yes||Yes||Yes|
|Allowed to export goods?||Yes||Yes||Yes||Yes||Yes||Yes||Yes|
|Accounting and tax|
|Corporate tax rate?||0%||0%||0%||18.50%||0%||18.50%||18.50%|
|Corporate bank account?||OCBC Singapore||HSBC UK||SCB Malaysia||HSBC Brunei||SBC Brunei||HSBC Brunei||Citibank Bank Brunei|
|Statutory audit required?||No||No||No||No||No||Yes||Yes|
|Annual tax return to be submitted?||No||No||No||Yes||Yes||Yes||Yes|
|Access to DTAAs?||No||No||No||Yes||Yes||Yes||Yes|
|Issued capital required?||US$1||US$2||US$1||US$1||US$1||US$1||None|
|Resident director required?||No||No||Local trustee||Yes||Yes||Yes||Yes|
|Resident bank signatory required||No||No||No||No||No||No||No|
|Local shareholder required?||Yes (51%)||No||No||No||No||Yes (100%)||No|
|Minimum number of directors?||1||1||1||1||1||3||1|
|Minimum number of shareholders?||1||1||2||1||1||1||Parent company|
|Individual shareholders allowed?||Yes||Yes||Yes||Yes||Yes||Yes||No|
|Corporate director(s) allowed||Yes||Yes||Yes||Yes||Yes||Yes||No|
|Corporate shareholders allowed?||Yes||Yes||Yes||Yes||Yes||Yes||Yes|
|Public register of shareholders and directors||No||No||No||Yes||Yes||Yes||Yes|
|Can the entity hire expatriate staff?||No||No||No||Yes||Yes||Yes||Yes|
|How long to get work permit approved?||3 months||3 months||3 months||3 months||3 months||3 months||3 months|
|Fees and timelines|
|How long to set the entity up?||2 weeks||2 weeks||2 weeks||3 months||5 months||3 months||14 weeks|
|How long to open corporate bank account?||1 month||1 month||1 month||1 month||1 month||1 month||1 month|
|Estimate of engagement costs||US$8,800||Contact us||US$15,400||US$10,960||Contact us||US$17,130||US$11,630|
|Draft invoice||Contact us||Contact us|