Brunei is the smallest country in Southeast Asia in terms of population, and the second-highest per capita income. A huge fraction of its wealth comes from abundant natural resources with crude oil and natural gas accounting for a high percentage of its GDP. To promote long-lasting economic stability, the government is making efforts to increase productivity in the tourism, Islamic banking, and manufacturing sectors. Several companies are operating within the territory, some owned by locals and others, jointly established by foreign investors. Doing business in the country isn’t relatively easy due to numerous setbacks yet it remains an attractive place for foreign investors. Aside from existing businesses, there are firms out of business and companies for sale. Currently, there are 59 active and verified businesses for sale and investment opportunities in the country on SMERGERS.
If you are an investor interested in buying a company here, there are available businesses on sale. This guide provides everything you need to know about business in this small Asian country.
Doing business in Brunei
Ranked 45th out of 138 by the World Economic Forum’s Global Competitiveness Report 2017 to 2018, it has one of the five most competitive ASEAN economies. The country has made effective improvements in infrastructure, institutions, health, and education over the years. Despite the little challenges faced by companies doing business here, it is still attractive for foreign investment as a country that charges no tax on personal income, or capital gain and has no sales tax. All of which grant business owners ease of doing business in the country. With the government interested in diversifying the economy and promoting tourism and manufacturing, companies can do well investing in the country.
Types of business entities
There are several legal entities allowed to be set up in the country. The forms include sole proprietorship, partnership, and company.
This is a business set up by a legal person who may or may not be a resident of the country. This type of entity is easy to establish, has few administrative duties, and is not required to pay corporate tax. The owner of the business is liable for any debt, loss, or action against the business.
This form can be set up by two or more persons. There is no need for paying corporate tax. All partners are liable for the debts or losses incurred by the business. ROCBN classifies sole proprietorships and partnerships as business names, under the Business Names Act (Cap. 92).
Companies must pay 18.5 percent of their income to the state government. They have strong corporate governance and transparency. Incorporating a company required at least two directors, one must be a citizen or legal resident. The two main types of companies are private limited companies (Sendirian Berhad) and public companies (Berhad). While private companies require at least two shareholders and at most 50, a public company needs at least seven shareholders, without a maximum limit. Private companies do not sell their shares to the public, but a public company does.
Registration of a business
You can register a business online, in at least one day, with the Registry of Companies and Business Names of the Ministry of Finance (ROCBN). The registration provides legal recognition for a business. Through www.roc.gov.bn, applicants can register by first creating an account, then filling out the application form, uploading required documents, and making necessary payments. Once it is approved, an email is sent to the applicant to confirm the registration, attached with a digital certificate of registration. The documents required to incorporate a company include notice of situation of registered office form, returns of allotment of shares, statutory declaration, stamping the share certificates and the Memorandum and Articles of Association, signed copy of the directors’ identity cards or foreign directors’ passports, a consent form to be directors, etc.
Buying a company
There are a lot of companies for sale within the country. Ensure you consult a good and reliable agent who can link you to a business owner looking to go out of business. Sometimes, when a company liquidates itself or closes, it is up for sale. You may choose to buy one but exert caution while doing this. It is best to hire an agent who can handle the transaction at your ease.