Discusses distribution network from how products enter to final destination, including reliability of distribution systems, distribution centers, ports, etc.
Using an Agent or Distributor
Personal relationships are important in Brunei and U.S. businesses may find a reputable local agent/distributor an important part of a sales strategy. The individual should be thoroughly familiar with local business customs and high-ranking government officials. The Commercial Section of the U.S. Embassy provides services that can help U.S. businesses locate an appropriate agent/distributor.
Establishing an Office
There is no restriction on total foreign ownership of companies incorporated in Brunei Darussalam. The Companies Act requires locally incorporated companies to have at least one of the two directors—or if more than two directors, at least two of them—to be ordinarily resident in Brunei Darussalam. The Companies Act allows the board to be totally non-resident; however, the company concerned would have to apply to the appropriate authorities for permission and justify such a decision. Notwithstanding whether the company is locally or foreign owned and managed, the rate of corporate income tax is the same.
All businesses in Brunei must be registered with the Registry of Companies and Business Names at the Ministry of Finance and Economy. Except for sole proprietorships and partnerships, foreign investors can fully own incorporated companies, foreign company branches or representative offices. FDI from multi-national corporations may not require a local partnership in setting up a subsidiary of their parent company in Brunei. However, at least one company director must be a Brunei citizen or permanent resident in Brunei Darussalam.
More information on incorporation of companies can be found on the Ministry of Finance and Economy’s website (https://www.mofe.gov.bn/divisions/incorporation-of-companies.aspx).
The Authority for Info-Communications Technology Industry (AITI) offers assistance to local ICT small- and medium-sized enterprises (SMEs) to connect with potential ICT partners and customers. The AITI website (https://www.aiti.gov.bn/SitePages/Index.aspx)provides additional information on these services.
Brunei has a relatively large number of franchises for its size, including food services and apparel. Franchises must be registered with the Ministry of Finance’s Registrar of Companies pursuant to Chapter 39 of the Companies Act. The Ministry of Finance assumed responsibility for the registry in 2012. After receiving approval from the parent company, franchises follow the same procedures as those registering a business (20 people or fewer) or a company (more than 20 people). The Ministry of Finance and Economy will provide tax rates for registering a business or company after the entity has submitted its registration.
The use of direct marketing has gained popularity for businesses in Brunei. Many companies in Brunei have taken advantage of advertising techniques such as cell phone text messaging, email, interactive consumer websites and social media sites, online display ads, database marketing, fliers, catalog distribution, promotional letters, targeted television and radio commercials, response-generating newspaper/magazine advertisements, and outdoor advertising/promotional events
A joint venture may take the form of a corporation or partnership. Several factors, including the nature of the project, would determine which type of joint venture is appropriate. In a corporate joint venture, the owners have limited liability whereas in a partnership joint venture, the partners have unlimited liability. If the parties to a partnership joint venture are corporations, then liability is limited to that of the participating corporations.
Even without a physical presence in Brunei, companies generally need a license to do business in the country. Local salespeople engaging in door-to-door product marketing, however, do not need a permit. In most cases, one does not need a Brunei citizen representative to do business commercially or when selling directly to the government.
Registry of Companies
Ministry of Finance and Economy
The Brunei government’s Postal Services Department is responsible for providing postal service, including Express Mail Service (EMS) throughout the country. International courier services are available through companies such as DHL, Fedex, and UPS.
The Ministry of Finance and Economy maintains registration of companies and ongoing projects in Brunei. Anyone considering doing business in Brunei is urged to conduct their own due diligence. Most law firms and accountancies offer due diligence services as well. A list of attorneys can be obtained at the Brunei Judiciary website (http://www.judiciary.gov.bn/Law%20Firms%20Document%20Library/LAW%20FIRMS%202021.pdf).
The Department of Commerce Foreign Commercial Service also offers the International Company Profile (ICP) service to U.S. companies interested in evaluating potential business partners overseas.
Researched and prepared by the U.S. Embassy Bandar Seri Begawan Commercial Section, ICPs enable U.S. small and medium-sized businesses to more effectively evaluate overseas companies. Companies can obtain detailed answers about the specific overseas companies of interest, competitors, credit rating, profit and loss numbers, key officers, and our opinion on the overall viability of the firm in its market