Brunei: Offshore Business Sectors
Comprehensive and imaginative legislation, coupled with a flexible regime to suit sophisticated business and personal international insurance and insurance related activities are governed by the International Insurance and Takaful Order, 2002 ('IITO)'.
There are 7 types of licenses available, which include general insurance, life insurance, life and general insurance and captive insurance businesses and International Insurance Manager, International Underwriting Manager and International Insurance Broker. Applicant can be a company including an established foreign or domestic insurance company or licensed registered agent and trust company in Brunei acting as representative for the purpose of license application.
Special provision is made for Financial Unit-linked and Reinsurance (access to domestic market). All long term products are protected against creditors in the absence of fraud and the concepts of insurable interest and ability of a beneficiary to enforce a contract enjoy constructive modification.
International insurance business (i.e. non-domestic business, conducted with non-residents, with the exception of re-insurance) must be carried on by an IBC or a foreign international company incorporated under the International Business Companies Order, 2000 ("IBCO"), a company incorporated under the (domestic) Companies Act (Chapter 39) or a company registered under Part IX of the Companies Act (Chapter 39), which holds a valid licence under IITO (see Forms of Companies).
Further, no person (including a corporation) may carry on any business as an international insurance manager, international underwriting manager or international insurance broker unless he holds a licence relating to such business.
Every application must include a business plan for the first three years of operation; copies of the applicant's constituent documents, where applicable a copy of the applicant's audited annual accounts for the 3 consecutive years immediately preceding the application, and in the case of a takaful or re-takaful provider, the names of the Shari'ah Council duly appointed to advise that provider. The Authority may request further or other information or documents.
Licence applications for international insurance managers, underwriters and brokers must satisfy the Authority that the controllers, directors and chief executive officers of the applicant are fit and proper persons having knowledge of the insurance related activities proposed to be conducted and is able to maintain sufficient funds to cover its expenses in the proposed activities for the period covered by its business plan.
Prior written consent of the Authority is required to open an office or establish any subsidiary in Brunei Darussalam or elsewhere. (section 24)
Services offered by a licensee are limited to those specified in the licence granted and may be provided only to other licensees under the Order. Services can not be offered relating to domestic insurance business, but a licensed international insurance broker may, notwithstanding any other written law, handle the re-insurance of domestic insurance business.
No taxes or duties of any description are levied, withheld or collected in respect of international insurance business of any licensee (includes insurer, managers, brokers, underwriters) of shares, and no filing or presentation of documents with or to any taxing or analogous authority in Brunei Darussalam is required. The tax/duty exemption may, at no extra charge, be evidenced by a certificate issued by the Minister, any such certificate to be valid for a period of 10 years from its date.
Dedicated Cell Companies ("DCC") are established pursuant to Part XIIA of IBCO, and subject to the prior consent of the Authority, may be initially established or reconstituted as a DCC. A DCC is a single legal person and may establish one or more cells for the purpose of segregating and protecting dedicated assets. The assets are either dedicated assets or general assets, and separate records and protection of dedicated assets by way of segregation and identification must be maintained.
Creditors are restricted in their rights to the cell in respect of which they have made funds available or have a claim.