ICDT’s Member States Business Guides
BRUNEI
I- PROFILE
Location:
Country name:
Area:
Population:
Capital:
Major Cities :
Languages:
Currency:
Climate
Main holidays
Weekly day off
Local time
Working hours
Principal
economic sectors:
Brunei is located at the north-west of the island of Borneo, between
east longitudes 114 degrees 04’ and 11 degrees 23’ and north
latitudes of 4 degrees 00’ and 5 degrees 05’
Brunei Darussalam
5765 sq Km with a coastline of about 161 Km along the South China
Sea.
322, 000 inhabitants in 1999
Bandar Seri Begawan
Bandar Seri Begawan (46 000 inhabitants), Muara, Seria, Kuala
Belait, Pekan Tutong and Bangar
Malay
Brunei Dollar (B$), 1 US$= 1.67 B$.
The climate is tropical marine, hot and moist, but nights are cool,
humidity is high and rainfall is heavy. Varying from 2500 mm on the
coast to 5000 mm in land. There is no dry season. Temperatures are
high, with annual extreme range being 23°C to 36°C;
January 1st, Chinese new year, February 23, June 1, July 15,
December 25, Eid Al-Fitr*, Eid Al-Adha*, Muharram 1st* , Aid alMawlid*
ƒ Government offices: Friday through Sunday
ƒ Commercial establishments: Sunday
Banks: Saturday p.m. - Sunday
GMT + 8
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Commercial establishments: From 9h to 17h Monday through
Saturday
ƒ Banks: 9h to 11h and 14h to 15h Monday Friday 10h to 11h
Saturday
ƒ Government offices: 8h to 12h and 13h30 to 16h 30 Monday
- Thursday
Oil and gas. Efforts to diversify the economy are underway
II - ECONOMIC SECTORS
II.1.. OIL AND GAS
Brunei's economy is dominated by the oil and liquified natural gas industries. Brunei is
the fourth largest producer of oil in South East Asia and the third natural gas producer in the
World. Oil and gas accounted for about 36 % of the country' s Gross Domestic Product.
II.2. OTHER SECTORS
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Brunei Government efforts to promote non oil and gas activities have succeeded to
reach figures showing 64% of GDP in 1996 compared to only 24,3 % in 1991.
These activities include construction and primary resources development, in particular
rice production, fruit farming, vegetables growing and livestock.
The main objective of the industrial policy is to enhance national food security,
develop industries for local market, industries based on local resources and industries for
export markets.
Foreign trade is largely dependant on three major export commodities, namely crude
oil, petroleum products and liquified natural gas. The most important markets are Japan, the
United States and ASEAN countries.
Brunei Darussalam practices open trading system through bilateral, regional and
multilateral trading arrangements such as ASEAN Free Trade Area (AFTA), Asia Pacific
Economic Cooperation (APEC) and General Agreement on Trade and Tariffs (GATT).
III. INFRASTRUCTURE
The infrastructure is well developped.
III.1. MARITIME TRANSPORT
There are two major ports, at Muara and Kuala Belait which offer direct shipping to
Hong Kong, Singapore and several other Asian destinations.
III. 2. AIR TRANSPORT
The International Airport of Bandar Seri Begawan includes passenger and cargo
facilities and the terminal is designed to handle 1,5 million passengers and 50 000 tonnes of
cargo a year.
III.3. ROAD NETWORK
There is a 2000 km road network with a main highway running along the entire
coastline. It links Muara, the point entry port at one end, to Belait, the oil production centre, at
the western end of the state.
III.4. TELECOMMUNICATIONS
A very modern network with a rate of availability which is currently 1 telephone for
every three persons. There are two earth stations providing direct telephone, telex and
facsimile links to most parts of the world. Several systems in operation include an analogue
telephone exchange, fibre-optic links with Singapore and Manilla, a packet switching
exchange for access to high speed computer bases overseas, cellular mobile telephone and
paging system.
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III.5. INDUSTRIAL AREAS
Brunei Darussalam offers vast land and a variety of facilities throughout all four
districts composing the country . There are twelve industrial sites presently developed, the
majority of them being ready and available for occupation.
IV. FOREIGN TRADE REGULATIONS
IV.1. LEGAL FRAMEWORK OF TRADE RELATIONS
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Brunei is member of the following international organizations:
Organization of the Islamic Conference (O.I.C) ;
United Nations Organization (U.N) ;
Association of Southeast Asian Nations (ASEAN) ;
Commonwealth
A commercial and economic cooperation agreement was signed between the European
Union and ASEAN. The agreement provides for most – favored- nation tariff treatment and
studies to remove barriers, create new trade patterns and recommend trade promotion
measures.
IV.2. TRADE STRUCTURE
IV.2.1. MAIN EXPORTED PRODUCTS:
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Crude Oil
Petroleum Products
Liquefied Natural Gas
IV.2.2. MAIN IMPORTED PRODUCTS:
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Machinery and transport equipment
Manufactured goods
Chemicals
Food
IV.2.3. PRINCIPAL TRADING PARTNERS:
Main Suppliers
-Japan
-Korea
-United States
-Thailand
-Australia
Main Customers
-Singapore
-Malaysia
-United States
-United Kingdom
-Japan
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IV.3.FOREIGN TRADE REGULATIONS:
IV.3.1.IMPORTS REGULATIONS
Most goods may be imported under open general license. Dangerous drugs are
prohibited, and some goods are restricted: petrol, kerosene, cigarettes, spirits and liquors,
firecrackers, and items bearing the imprint of state emblems. Specific import licenses are
required for a few imports, including plants, cattle, birds, fish (live or dead), drugs,
gambling machines, and used vehicles.
At the import level the following documents are required:
Commercial invoice: The commercial invoice may be printed on the shippers
letterhead, it must be signed by a responsible in the firm. Facsimile signatures are not
acceptable. The country of origin, quantities, weights, proper description of the
merchandise, and all itemized expenses to CIF value must be shown in the invoice.
Certificate of origin: An importer may request certificate of origin which is also
necessary for letter of credit. The certificate must be prepared in duplicate on a general
form sold by commercial printers, and it must be certified by a recognized chamber of
commerce, which usually requires one additional copy for its files.
Bill of lading: There are no regulations specifying the form or number of bills of
lading required for any particular shipment. A bill of lading customarily shows the name of
the shipper, the name and address of the consignee, port of destination, description of the
goods (including measurements and weight), the listing of the freight and other charges,
the number of bills of lading in the full set, and the date and signature of the carrier’s
official acknowledging receipt on board of the goods for shipment. The information should
correspond with that shown on the invoices and the packages. The airway bill replaces the
bill of lading on air cargo shipments.
Packing list: A packing list must be presented with the import declaration before
goods can be cleared through customs.
IV.3.2. EXPORTS REGULATIONS
Exporters must contact authorities in Brunei to obtain information about regulations and
modalities and legalizations that should be applied.
IV.3.3 OTHER FORMALITIES AND DOCUMENTS
Certain goods may only be imported into Brunei with the approval of the appropriate
authorities. Pharmaceutical and drug related products must be approved by the ministry of health
; animals and plants must be approved by the agriculture department, and automobiles must be
approved by the customs department.
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Marking: There are no stipulations regarding how shipments must be marked, and any
common shipping practice may be followed.
In general, all identifying marks, including the consignees mark with port marks, should be
inscribed plainly on the packages to facilitate the arrival of the shipment. Packages should be
numbered unless the contents are such that they can be identified readily without numbers.
Packing: Inside wrapping, greasing, insulating and stowing should be considered for
exports to Brunei. Soft or corrugated fiber cases should be used only when absolutely
unavoidable, since they generally are too absorbent to withstand the humid climate. Hard fiber is
suitable for light materials, but wood remains the most suitable type of packing.
IV.4. FINANCIAL REGULATIONS OF FOREIGN TRADE OPERATIONS:
IV.4.1. BANKING SYSTEM:
The department of financial services (Treasury), the Brunei Currency Board and the
Brunei Investment agency, under the ministry of finance, perform most of the functions of a
central bank.
In 1996 the financial sector comprised seven banks, of which six were branches of
foreign institutions, and five finance houses. The country’s large national reserves and the
local expertise being cultivated by the Brunei Investment Agency, offer potential for Brunei’s
development as a merchant banking centre in the region.
The major commercial Banks are: Baiduri Bank, Development Bank of Brunei,
Islamic Bank of Brunei, Citibank, the Hongkong and Shanghai Banking Corpn.
IV.4.2. FOREIGN EXCHANGE SYSTEM:
There are no restrictions on the importation of capital from any country, nor are there
restrictions on overseas remittances of capital or profits.
Non-resident can maintain their accounts, and borrow money from banks.
IV.4.3. METHODS AND MEANS FOR INTERNATIONAL SETTLEMENT
There are no exchange controls in Brunei
IV.5. CUSTOMS TAXATION
Brunei has a single – column tariff system based on the customs cooperation council
nomenclature.
IV.5.1. APPLICABLE DUTIES AND TAXES
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Customs duties: Customs duties are assessed either on a specific or ad-valorem basis.
Most foodstuffs, non-alcoholic beverages, and industrial machinery are exempt from import
duties. Clothes, watches, and Jewelry are subject to a rate of 10 percent ; motor vehicles and
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spares, electrical equipment, photographic materials, timber, and furniture, to 20 percent ;
and cosmetics and perfumery to 30 percent.
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Preferential duties: the Association of Southeast Asian Nations (ASEAN), which
includes Brunei, Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam, agreed to
a gradual lowering of mutual trade barriers and the creation of a free trade area.
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Specific duties: Specific duties are levied on a few items. Containers and packing
materials are excluded from duty assessment when specific duties are levied on a weight
basis.
ƒ Advance ruling: Requests for advance ruling may be submitted along with a sample of
the product in question and descriptive literature to the controller of customs and excise
for classification.
V- FOREIGN INVESTMENT
V.1. OPENNESS TO FOREIGN INVESTMENT
Brunei Darussalam is engaged in a programme to improve its investment climate in
order to establish and enhance local and foreign investment opportunities. This effort involves
establishing bilateral investment treaties with other countries and joint ventures between the
local private sector and private sector in other countries.
Competitive investment incentives are available throughout the business cycle of start
up, maturity and expansion. The Investment Incentive Act of 1975 provides tax advantages at
start up and ongoing throughout growth and expansion. Flexible industrial policies including
manpower, ownership, government support and facilities are open to investors for all
categories of industrial activities. They allow for full foreign ownership, majority foreign
ownership and minority foreign ownership, as per the type of industry and situation. Only
activities relating to national food security imply some level of local participation. Industries
not related to national food security and industries for total export can be totally foreign
owned. Overall, any industrial enterprise could be considered by Brunei autorities .
The Ministry of Industry and Primary Resources is the focal point and OneStop
Agency which coordinates all industrial development activities.
V.2. TAXATION
Brunei Darussalam has no personal income tax. There are no export, sales, payroll or
manufacturing taxes. Sole proprietorship and partnership businesses are not subject to income
tax. Only companies are subject to one of the lowest income taxes in the Region. Tax
advantages at start up and ongoing incentives throughout growth and expansion offer
investors profitable conditions.
Company taxation is limited to the following types of taxes on income :
- Gains of profits from any trade, business or vocation ;
- Dividends received from companies and previously assessed for tax in Brunei ;
- Interests and discounts;
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- Rents, Royalities, premiums and any other profits arising from proprieties.
In addition there is no capital gains tax.
VI. CONVERSION AND TRANSFER POLICIES
There is no foreign exchange control. Banks permit non-resident account to be
maintained and there is no restriction on borrowing by non-residents.
VII .FINANCIAL AND BANKING SYSTEM
Brunei Darussalamn operates a Currency Board system and has no Central Bank.
There are currently eight commercial banks providing full banking services :
- Baiduri Bank Berhad
- Citibank
- Development Bank of Brunei Berhad - Hongkong Bank
- Islamic Bank of Brunei Berhad
- Malayan Bank Berhad - Overseas Union Bank
- Standard Chartered Bank
- Sime Bank Berhad.
Two of these are locally incorporated. International banks such as Citibank, Hongkong
and Shangai Bank and Standard Chartered Bank have been operating branches for decades.
The financial system includes a number of locally incorporated and international finance and
insurance companies. Interest rates are set by The Association of Banks.
VIII. INVESTMENT AGREEMENTS
VIII. 1.BILATERAL AGREEMENTS
Brunei Darussalam has ties with many countries establishing mechanisms for
consultation and cooperation in order to facilitate investment and to enhance economic
cooperation. Indonesia, Oman and Malaysia are among the Countries with which Brunei has
trade and investment agreements.
VIII.2. REGIONAL AGREEMENTS
Brunei Darussalam is part of the Association of South East Asian Nations (ASEAN)
since 1984. It is also part of Asia Pacific Economic Cooperation (APEC) together with as
many countries as Australia, Canada, Indonesia, Japan, Republic of Korea, Malaysia, New
Zealand, the Philippines, Singapore, Thailand, the United States of America. ...It participates
within APEC to various actions and Committees on trade and investment issues.
It is also a member of the Organization of the Islamic Conference(OIC).
VIII. 3. INTERNATIONAL AGREEMENTS
Brunei Darussalam is also part of a certain number of political and economic
International institutions such as the United Nations system and the World Trade
Organization.
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IX. USEFUL ADDRESSES:
Public establishments &
Organisations
Prime Minister’s Office
Information Department
Prime Minister’s Office
One Stop Agency
The Ministry of Industry and
Primary Resources
ADDRESS
Prime Minister’s Office
Istana Nurul Iman
Bnadar Seri Begawan BA
1000
Berakas Old Aeroport
Bandar Seri Begawan
BB 3510
Bandar Seri Begawan 1220
PHONE / FAX/TELEX/
E-mail/Website
Tel : 673 2 229988
Fax: 673 2 241717
Telex: BU2727
E-mail: [email protected]
Tel : 673 2 380527
Fax : 673 2 381004
E-mail: [email protected]
Tel : 673 2 244822
Fax : 673 2 244811
Telex: MIPRS BU 2111