This information is derived from the State Department's Office of Investment Affairs’ Investment Climate Statement. Any questions on the ICS can be directed to EB-ICS-DL@state.gov
Last Published: 7/10/2017
Brunei is a small energy-rich Sultanate on the northern coast of Borneo in Southeast Asia. Brunei boasts a well-educated, largely English-speaking population, excellent infrastructure, and a government intent on attracting foreign investment and projects. In parallel with Brunei’s efforts to attract foreign investment and create an open and transparent investment regime, the country has improved its protections for IPR.

Despite repeated calls for diversification, Brunei’s economy remains dependent on the income derived from sales of oil and gas, contributing about 60 percent to the country’s GDP. Substantial revenue from overseas investment supplements income from domestic hydrocarbon production. These two revenue streams provide a comfortable quality of life for Brunei’s population. Citizens are not required to pay taxes, have access to free education through the university level, free medical care, and frequently, subsidized housing and car fuel.

Brunei has a stable political climate and is generally sheltered from natural disasters. Brunei’s central location in Southeast Asia, with good telecommunications, numerous airline connections, business tax credits in specified sectors, and no income, sales, or export taxes, offers a welcoming climate for potential investors. Sectors offering U.S. business opportunities in Brunei include aerospace and defense, agribusiness, construction, petrochemicals, energy and mining, environmental technologies, food processing and packaging, franchising, health technologies, information and communication, Islamic finance, and services. In 2014 Brunei released an Energy White Paper outlining its vision of leveraging its oil wealth to diversify its economy, create local employment, increase FDI, and sharply increase the use of renewable energy by 2035. Thus far, the government has shown it is committed to the priorities outlined in the Energy White Paper.

In 2014, Brunei began supplementing its existing common law-based penal system with a penal code based on Islamic law, which carries Sharia punishments. The Sharia Penal Code is applicable across the board. The first phase became effective in May 2014 and remains in place today. It expands restrictions regarding alcohol consumption, eating in public during the fasting hours in the month of Ramadan, and indecent behavior. Two subsequent phases, the timing of which is not yet clear, are expected to introduce severe punishments such as stoning to death for certain sex-related offenses and the amputating of limbs. Brunei officials say the most severe punishments will rarely, if ever, be implemented given the very high standard of proof required under the Sharia Penal Code. While the law does not specifically address business-related matters, potential investors should be aware that there is controversy surrounding the Sharia Penal Code issue. Thus far there have been no recorded instances of U.S. citizens, or U.S. investments, being targeted by the Sharia law.
Table 9 – Brunei Investment Climate
MeasureYearIndex/Rank
TI Corruption Perceptions Index201641 of 175
World Bank’s Doing Business Report “Ease of Doing Business”201684 of 190
Global Innovation Index*2016N/A
U.S. FDI in partner country ($M USD, stock positions)2015$ 7.0 M
World Bank GNI per capita2015$ 38,010
 *Brunei did not participate in the 2016 Global Innovation Index.

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Brunei Economic Development and Investment Law