Brunei: Country and Foreign Investment
This page was last updated on 10 May 2019.
The oil-rich Islamic Sultanate of Brunei Darussalam is close to vital sea lanes running through the South China Sea linking the Indian and Pacific Oceans. In the formal name of the country, ‘Brunei Darussalam’, the last word comes from the Arabic dar as-salaam, which means ‘house of peace’. Except in formal situations, the country is simply known as Brunei.
The climate is tropical. The capital is Bandar Seri Begawan. The country consists of two parts physically separated by a finger of Malaysian territory. Brunei's major natural resources are petroleum, natural gas and timber.
Brunei was a powerful state from the 16th to the 19th century, but in 1888 it became a British protectorate. Britain retained responsibility for the state's defence and foreign affairs until 1984, when the sultanate became fully independent.
As of May 2019, the population is estimated to be 440,000. The official religion is Islam and the official language is Malay; English and Chinese languages are also spoken.
Officially a a constitutional sultanate, Brunei is in effect an absolute monarchy. The sultan and prime minister is Sir Hassanal Bolkiah (since 5 October 1967). General law is based on English common law; for Muslims, sharia supersedes civil law in a number of areas.
Total GDP was estimated to be US$12.1bn in 2017; the per capita equivalent at purchasing power parity was US$71,810. Revenues in 2011 were $2.87 billion against expenditure of $4.45 billion. The currency is the Bruneian dollar.
In 2000, Brunei instituted a tax-privileged international financial centre (the BIFC) providing regimes for banking, insurance, investment funds and trust management. Accordingly, 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. 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.
In Brunei there is no personal income tax, and there are no export, sales, payroll or manufacturing taxes. Sole proprietorship and partnership businesses are not subject to income tax. The main tax for resident ('domestic') companies is corporate tax, but this does not apply in the BIFC.