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Brunei: Country and Culture
ASIA/PACIFIC
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A DIFFERENT TAX JURISDICTION
Brunei:
Country Overview
Since the establishment of the International Financial Centre (BIFC),
Brunei is a "dual jurisdiction", whereby the international
legislation offers "offshore" facilities, alongside
the usual range of "domestic" legislation drawn from
that of England and Wales.
Prior to formal establishment of the BIFC in July, 2000, Brunei
was already a busy commercial centre, as witnessed by
the existing active presences in the Banking sector
of HSBC, Standard Chartered, Citibank, Overseas Union
Bank, RHB, Maybank, Baiduri Bank, Islamic Bank of Brunei
Berhad, Islamic Development Bank of Brunei and The Brunei
Islamic Trust Fund. A full range of accounting and legal
services is also available with many law firms and major
accounting firms having significant presences in Brunei.
Legislation passed in 2000 introduced a number of additional corporate
forms which are available to business operations in
the International Financial Centre, including International
Business Companies, International Limited Partnerships,
and International Trusts.
Unlike many IFCs, Brunei has the advantage of already being an
affluent society based on the fossil-fuel economy. The
country’s motives in establishing an IFC regime are
therefore more subtle and socio-economic than simply
to generate an income-stream to supplement tourism.
The goals motivating the establishment of the IFC included developing
the capacity to:
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Diversify, expand into and grow the value added financial service
sector of the economy of Brunei and the Asia Pacific
Region (APR) as a Tier One Player.
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Provide a secure, cost-effective, sensibly regulated IFC facility,
which will offer a safe harbour for the conduct of
significant regional and international business for
corporate and private clients.
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Provide well-qualified Bruneians with purposeful, challenging
and rewarding careers, following their educational
advantages.
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Attract overseas professionals to assist in running the IFC to
the highest standards.
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Encourage expatriate professionals to become involved in training
and development of rewarding opportunities for professionally
qualified and trained Bruneians in the International
Business Sector.
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Increase returns for the hospitality, transport and amenity industries,
including eco-tourism, culminating in an holistic
result for the country’s economy.
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Position Brunei as an equal partner in the globalisation of financial
and commercial activity, and thereby, to generate
greater communication with and between other nations.
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Brunei:
Business Culture
Brunei
is a predominantly Malaysian and Muslim country, although
with an admixture of Chinese and other regional cultural
elements. Muslims pray five times a day; alcohol is banned
from the state of Brunei, and Muslims follow other dietary
rules in addition.
The
official language of Brunei is Malay, but English is widely
used, particularly in business affairs. Most schools above
primary level teach in English. Friday is equivalent to
a Western Sunday; everything is shut. Saturday is at least
half a working day, but most businesses are shut again on
Sunday. Business activity is at a low ebb during the month
of Ramadan; in 2010, Ramadan began on August 10.
It is
very unusual for a foreigner to be invited into the home
of a Bruneian; if you are so invited, gifts are acceptable
but would not normally be opened on the spot. Shoes are
to be removed before entering a private home. Food should
be handled only with the right hand.
While
the rule of law, which forms the bedrock of Western, and
particularly Anglo-Saxon business relationships, is well-established
in a formal sense in Brunei, collective, family and hierarchical
relationships play a much more prominent role in Brunei,
as in other Asian cultures, than they commonly do in the
West.
In
Brunei, although perhaps less so than in China or Japan,
a successful negotiation, and a successful business relationship,
is therefore dependent on recognizing that a contract, while
necessary and important, is only one aspect of the cultural
nexus in which a foreign investor is operating. It may be
difficult, also, to locate responsibility and decision-making
power among a group of Bruneians with whom you are negotiating
or dealing.
Central
to Bruneian inter-personal culture is the concept of 'face'.
In the collective, position is dependent on reputation,
and nothing is more deadly to the self-esteem of a member
than loss of face. A foreigner who is seen as the agent
of such loss of face has committed a serious and possibly
fatal error of negotiation.
While
it may be difficult at first to understand the relative
positions of individuals in the group with which you are
negotiating or dealing, there are some pointers. It is highly
probable that the members of a team will enter a room in
the order of their relative importance, especially in the
presence of a foreigner; and junior members of the team
will constantly defer to their seniors in conversation and
in bodily behaviour.
Due
to the importance attached to 'face', business cards have
much greater importance in Asian societies than in the West,
where they have rather taken a back seat, and relative position
among a group of Bruneians will be reflected in the order
in which they present their business cards, as well as on
the cards themselves, if you can understand them! When presenting
your business card, you should offer it with both hands;
likewise, you should take a business card with both hands,
study it carefully, and place it respectfully in a pocket
or on the table in front of you.
It
is normal to address a person by their title either instead
of or as well as their personal name. Titles can be quite
long; the word Pengiran indicates a relationship to the
royal family.
It
is normal to shake hands when meeting someone of your own
sex, but a nod or slight bow is also often appropriate,
particularly for someone you already know. It is rare for
men to shake hands with women. A handshake should not be
very forceful; and it may last quite a number of seconds.
It is rude to look straight into the eyes of a Bruneian
person; more proper would be a quick glance, and then lower
the eyes as a sign of respect.
Of
course, much business in Brunei is conducted among Westerners,
and in that case normal international business rules will
apply. It is only when coming into contact with Bruneian
companies and people that the suggestions in this section
will apply.
Business
etiquette is quite formal in Brunei. It is normally necessary
to make appointments well in advance, and punctuality is
respected. Do not arrive at a meeting with unannounced companions;
details should be sent in advance. This is an aspect of
the importance attached to rank and hierarchical position.
Remaining calm and smiling is an essential cornerstone of
successful negotiating.
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Brunei: Employing People
Labour policy in Brunei Darussalam is flexible. The shortage
of local labour has been compensated by the recruitment
of foreign workers which makes up about one-third of the
total work-force. Thus an investor rarely faces difficulties
in securing approval for recruiting foreign workers especially
in cases where locals are not available to perform the job.
All non-Brunei Darussalam citizens require a work permit which
is valid for two years. Application must first be made to
the Labour Department for a labour licence. On the recommendation
of the Labour Department, the Immigration Department will
give permission for the workers to enter Brunei Darussalam.
The Labour Department requires either cash deposit or a
banker's guarantee to cover the cost of a one-way airfare
to the home country of an immigrant worker.
An approved labour licence cannot be altered for at least six months
after issue. Applications will not be accepted until the
formation of a local company or a branch of foreign company
has been officially approved and registered.
Visitors who wish to enter Brunei Darussalam to take up employment
must arrange with their employers to obtain employment passes
prior to their arrival. Spouses and children under 18 years
of age of pass holders are required to obtain dependents'
passes.
Brunei: Entry and Residence
Nationals of Austria, Germany, Malaysia, The Netherlands, New Zealand,
Sultanate of Oman, Singapore, South Korea, the United
Kingdom and the UAE are exempted from the requirement
to obtain a visa for visits not exceeding 30 days.
Visas are also waived for visits of not more than 14 days for nationals
of Belgium, Canada, the Czech Republic, Denmark, France,
Hungary, Indonesia, Italy, Japan, Laos, Luxembourg,
Republic of Maldives, Norway, Peru, Poland, The Philippines,
Slovakia, Spain, Sweden, Switzerland, Thailand and
The Principality of Liechtenstein.
The
maximum stay for United States nationals is 90 days
before a visa is required.
Nationals of Australia and Qatar are issued visa on arrival upon
their arrivals at the Brunei International Airport
only for visits not exceeding 30 and 14 days respectively.
All other nationals entering Brunei Darussalam must have visas
obtainable from any Brunei Darussalam diplomatic mission
abroad.
Persons entering Brunei Darussalam to take up employment must arrange
with their employers to obtain employment passes prior
to their arrival. Their spouses and children under
18 years of age of pass holders are required to obtain
dependents' passes.
Every foreigner who intends to work in Brunei Darussalam must have
a valid Employment Visa authorised by the Department
of Immigration and National Registration and is issued
at the Brunei Embassy or High Commisioner.
Maximum length of the validity of an employment visa is 3 years.
Processing usually takes 7 working days.
The employer must have a quota license from the Labour Department
and needs an approval letter from the work pass section
of the Immigration and National Registration Department.
The worker should have a valid passport/travel document
recognised by the Brunei Director of Immigration and
National Registration. The passport must have a validity
of 6 months before entering the country.
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