Get documents about "Brunei's legal landscape
Document Sample
184 Brunei
Brunei
Chamber of commerce: Professional body:
Brunei International Chamber of The Law Society Of Brunei Darussalam
Commerce and Industry PO Box 66
PO Box 2285 Seri Complex BA 1779
1922 Bandar Seri Begawan Brunei Darussalam
Brunei Darussalam Email: secretary@bruneilawsociety.org
Tel: +673 2 236 601 Web: bruneilawsociety.wordpress.com
Fax: +673 2 228 389
Brunei’s legal landscape Islamic courts Main legislation applicable to financial and
There is a separate and independent system of related institutions
Muhd Jamil Abas bin Abdul ‘Ali and James courts in Brunei Darussalam known as the The main legislations which affect and regu-
Chiew Syariah Courts, which have jurisdiction on late financial and related institutions are: (i)
Abrahams Davidson & Co respect of Islamic laws and are governed by the Banking Order 2006; (ii) the Islamic
Bandar Seri Begawan the Syariah Courts Order. However, the Banking Act Cap 168; (iii) the Insurance
Syariah Courts’ jurisdiction extends only to Order 2006; (iv) the Syariah Financial
Form of government matters pertaining to the Islamic faith such as Supervisory Board Order 2006; (v) the
The government of His Majesty the Sultan marriage, divorce, family and Islamic gifts and Securities Order 2001; (vi) the Mutual Funds
and Yang Di-Pertuan of Brunei Darussalam the succession to the estate of deceased Order 2001; (vii) the International Banking
governs by and in accordance with the Articles Muslim persons. Order 2000; (viii) the International Insurance
of a written constitution proclaimed in 1959 and Takaful Order 2002; (ix) the
and amended in 2004. Under the constitu- Main financial institutions International Business Companies Order
tion, the supreme executive authority vests in Presently, there are eight commercial banks 2000; (x) the International Limited
His Majesty The Sultan and Yang Di-Pertuan. providing the full range of modern banking Partnerships Order 2000; and (xi) the
and investment products and services. There Companies Act Cap 39.
Sources of law are also a number of (both domestic and
The sources of the law of Brunei Darussalam international) financial institutions and insur- Preventive legislation
consist of local statute law, common law and ance companies. Added to this institutional To maintain the integrity and reputation of
principles of equity as applied in England landscape are a number of international banks Brunei Darussalam and to encourage major
before April 25 1951. It is administered by that have been granted licences for both inter- participants in the financial markets to use
and in the civil courts. The common law of national banking, investment banking, invest- Brunei Darussalam for their financial busi-
England, and its doctrines of equity and ment related services and investment advisory nesses, laws have been enacted to combat
statutes of general application, with certain services. There were two Islamic banks in financial crimes and related offences. These
exceptions, apply to Brunei Darussalam by Brunei Darussalam, but in 2007 the Islamic include: (i) the Money Laundering Order
virtue of The Application of Laws Act Cap 2 Development Bank of Brunei and the Islamic 2000; (ii) the Criminal Conduct (Recovery of
of April 25 1951. Legal precedents from Bank of Brunei were merged under a new Proceeds) Order 2000; (iii) the Anti-
English courts continue to be more persuasive entity (the Bank Islam Brunei Darussalam) to Terrorism (Financial & Other Measures)
than those from other Commonwealth coun- consolidate their assets, products and services. Order 2002; and (iv) the Emergency (Drug
tries. The Tabung Amanah Islam Brunei Trafficking) (Recovery of Proceeds) Order
(Brunei Islamic Trust Fund) is a financial 1996.
Civil courts and legal practitioners institution providing a limited range of
The majority of private lawyers and judges in Islamic banking and investment products. Exchange controls
Brunei Darussalam were educated and Conventional banks are licensed under and There is currently no exchange control
obtained their professional qualifications in regulated by the recently enacted Banking imposed on currencies.
England, while a number of former Hong Order 2006, while Islamic banks and trust
Kong judges continue to sit in the Brunei funds are licensed and regulated by the Restricted financial activities in Brunei
Darussalam courts. The current Chief Justice Islamic Banking Act and the Tabung Amanah Certain financial and related activities are reg-
of the High Court of Brunei Darussalam was Islam Brunei Act respectively. ulated by laws and can only be carried out if
a former judge of the High Court of Hong appropriately licensed. These activities
Kong. The President of the Court of Appeal is Supervision of financial institutions include: (i) the marketing and/or offer to the
a citizen of Australia. A substantial number of Financial, banking and investment activities public of interests in a collective investment
local judges sitting in the High Court of are supervised and regulated by the financial- scheme; (ii) the giving of investment advice;
Brunei Darussalam were educated and institutions division of the Ministry of (iii) offers of shares and debentures in a limit-
obtained their professional qualifications in Finance. The Ministry of Finance is also ed company to the public; (iv) the conducting
England. responsible for the issuance of licences for of insurance business; and (v) the carrying on
restricted financial, banking and investment of banking business which includes the receiv-
businesses.
www.iflr1000.com 2009 EDITION
Financial and corporate | Brunei 185
ing, taking or accepting of advertising for Financial and corporate occasions I have asked Abrahams to speak
deposits under the Banking Order. with our industry’s investors who were very
The term public is not defined by legisla- Recommended firms impressed that they operated and thought as
tion. What does or does not constitute an Tier 1 they did. I can not speak highly enough of
offer to the public will depend on circum- Abrahams Davidson & Co them as Abrahams made us look good too.”
stances. The courts of Brunei Darussalam will CCW Partnership James Chiew and Bernard Tan are widely
be guided by the decisions of England and Dr Colin Ong Legal Services acknowledged for their expertise. “James
other Commonwealth countries with similar Chiew is excellent with land matters and has a
legislations. Tier 2 great mind,” says one client. Bernard Tan also
Ahmad Isa & Partners comes in for client praise: “He is extremely
Corporate legislation Daud Ismail & Co thorough and very knowledgeable. I have
The legal framework regulating the setting up DF Abang Zen worked with him for a few years now and have
and administration of private limited compa- Hale Zainidi Ong complete confidence in his abilities.”
nies are provided for in Companies Act Cap K Lim & Company The firm is highly regarded for advice on
39. Foreign companies seeking to conduct Pengiran Izad & Lee the establishment of joint ventures as well as
business in Brunei may either incorporate a YC Lee & Lee securitisation, private placement of funds and
local subsidiary company or register as a Islamic banking.
branch office, as is the case of all well-known The start of Brunei’s programme in 2006 to One of the biggest deals Abrahams
international banks operating in Brunei at issue short-term sovereign sukuk al-ijarah Davidson & Co worked on this year was
present. (Islamic sale-and-leaseback bonds) was a bold advising foreign lawyers on local compliance
The Brunei Companies Act is modelled on move to signal that the sultanate is serious in issues and the transfer of securities from a
the English Companies Act 1929, although its intent to join the ranks of Bahrain and local subsidiary in connection with a $135
changes have been made to it from time to Kuala Lumpur as an Islamic-finance heavy- million murabaha (Islamic deferred sale) facil-
time. In this respect, provisions for the regis- weight. The programme has since seen 13 fur- ity between an international bank and a petro-
tration, incorporation, formation, member- ther issuances, despite the lack of a conven- leum company in the Gulf. The firm also
ship, management and administration, direc- tional domestic capital market. advised on legal compliance in setting up a
tors’ duties and obligations, meetings and 2008 saw another move towards building $70 million investment fund and joint ven-
winding-up are similar to those found in Brunei as a centre for Islamic finance. In ture between a state entity and foreign partic-
England. response to King Abdullah’s $2.64 billion ipants.
reforms to the Saudi shariah judicial system,
International business companies including the upgrading and training of Leading lawyers
In its effort to promote Brunei as an interna- judges, the Government of Brunei is now also Muhd Jamil Abas bin Abdul ‘Ali
tional financial centre, the International said to be planning to follow suit. It has start- James Chiew
Business Companies Order 2000 was intro- ed to entertain calls from Muslim scholars for Bernard Tan
duced for the setting up of an international an overhaul of shariah colleges and is looking
business company (IBC) or offshore company at codifying shariah laws. Ultimately, the
whose primary purpose is to conduct business jurisdiction hopes to train more scholars in CCW Partnership
with non-residents. An IBC is not permitted Islamic bank supervision to keep up with CCW Partnership has been promoted to the
to conduct business with persons resident in global demand. top tier after universal praise from clients and
the country and may not own an interest in With Brunei’s Islamic-finance industry peers, one of whom describes it as “definitely
land save for a lease. An IBC is exempted from starting to mature, the country’s lawyers are a key player with a loyal following of bank
corporate tax, income tax, tax on capital gains see an increasing demand from international clientele”.
or other direct or indirect tax in connection banks and law firms for advice on local com- “Andrew Ong has depth and understand-
with any activity, business or investment with pliance as well as work from local banks who ing that is unmatched,” says a client of the
respect to dividends, earnings, interests or are introducing new Islamic investment prod- firm. “As a seasoned legal veteran he under-
other returns from shares, debts or securities. ucts to their clients. stands our needs and offers clear legal counsel
Stamp duty is also not chargeable on the These developments, and the increasing and excellent personal service,” says a client.
instruments of transfer of any property to or price of oil, the fiscal surplus and the expan- Dunstan Sim is also widely recognised and
by an IBC or in relation to shares, debt or sion of trade, make this an exciting era for respected in the Brunei legal market.
other securities. Brunei’s financial sector. The reputation of CCW’s corporate and
banking departments as one of the best in the
country is reinforced by the firm’s commercial
Abrahams Davidson & Co litigation department. For example, CCW
“Why did we originally choose Abrahams? Partnership acted for a bank in a judicial man-
Purely for their reputation,” says a client. agement case under the new provisions of the
“When we require local legal counsel we Companies Act in the High Court and Court
always use Abrahams Davidson & Co as they of Appeal. The case, handled by Andrew Ong
prove to be consistently reliable, professional and Linda Lee, was an important precedent
and easy to deal with.” Clients also empha- because it established the limits of a judicial
sized that as one of Brunei’s largest firms the managers’ statutory powers against the propri-
practice has greater exposure to, and an in- etary rights of secured creditors.
depth understanding of, a wide range of CCW Partnership has advised clients
industries. Says a client: “On a number of including HSBC, Crédit Agricole,
2009 EDITION www.iflr1000.com
186 Brunei | Financial and corporate
Halliburton, Maersk Contractors and Brunei sulted Ahmad Isa & Partners on local law Hale and Zainidi & Associates. All three
National Petroleum on a range issues from aspects of cross-border financing and refi- name partners, Muhammad Zainidi Abdul
establishing their presences in the market to nancing deals. Hamid (the president of Brunei’s law society),
private placements of funds. Its counsel is also The firm is perceived as having strong gov- Sue Fen Ong and Damien Francis Hale are
sought by numerous international law firms ernment ties, which were evident when it well known and respected in Brunei’s legal
such as Blake Dawson & Waldon and acted as counsel to the Government of Brunei community. “With Ong and Hale you can
Thommessen Krefting Greve Lund. Recently when the sultanate issued its first sukuk al- always be sure of sound legal advice with
US law firm Baker & Daniels retained the ijarah in 2006. On the back of this ground- quick execution,” observes one rival while a
firm’s services on a high-profile deal involving breaking project - which created a local client praises Hale for providing “the kind of
the acquisition of an international company. Islamic capital market even though the juris- service one would expect from a first-rate
diction had no conventional non-Islamic cap- firm”.
Leading lawyers ital market - Ahmad Isa & Partners is often Hale Zainidi Ong has experience in vari-
Andrew Ong sought after for Islamic-financing issues, with ous commercial and financing mandates on
Dunstan Sim shariah bank Tabung Amanah Islam Brunei as behalf of clients such as TM Asia Insurance
one of its many clients. Singapore, the TSL Group (responsible for
The firm also excels in corporate, banking some of the largest construction projects in
Dr Colin Ong Legal Services and insurance law. To sum up, one client says: Brunei, including the recently-opened
The firm retains its first tier ranking, thanks “Ahmad Isa & Partners provides good quality Parliament Building) and Islamic banking
to managing partner Colin Ong’s reputation service [and is] sensibly priced.” institutions such as Tabung Amanah Islam
with clients. Says one: “He is the go-to person Brunei and BIBD At-Tamwil. The firm is also
for strategic legal counsel, particularly stand- Leading lawyers considered one of the leading law firms for
ing out when it comes to more complicated Aisha Alkaff large-scale liquidations in Brunei.
issues, as he knows everything about every- Ahmad bin Isa
thing that matters.” This reputation has won Leading lawyers
the firm a client base spanning several quasi- Damien Hale
governmental bodies, international banks, law Daud Ismail & Co
firms, high net-worth individuals and multi- Daud Ismail & Co is known for being
national companies across Asean and domes- engaged by local and international parties in K Lim & Company
tically. large commercial and financial transactions. The recent departure of Adrian Chan to
Ong, who is a member of two UK barris- Managing partner Mohamad Daud Ismail, Veerasamy Associates arguably weakens K
ters’ chambers, is often retained for his exper- a former mayor of Malaysia’s Limbang Town, Lim & Company but the market’s opinion is
tise on projects such as the $100 million is well-regarded by both clients and peers: that this will not necessarily have a long-term
restructuring of the main-listed parent entity “For a two-man show they are actually really effect on the firm’s reputation or work flow.
of Macquarie Bank under English and Brunei good, especially in shariah-compliant finance, Name partner Kelvin Lim has an excellent
laws. and they do well with property,” says one. reputation with a number of clients, one of
In the past year, one of the most significant “Ismail provides answers and solutions, not which describes him as “savvy and knowl-
deals Dr Colin Ong Legal Services advised on, problems. I would not hesitate to recommend edgeable”. Competitors comment that K Lim
and drafted all legal documentation for, was them.” & Company is a “respectable firm with great
RHB Banks $15 million financing deal for the talent”, while one says of the name partner:
Giant group of hypermarkets, which will see Leading lawyers “Kelvin has a very sharp mind and provides
the construction of Brunei’s largest supermar- Mohamad Daud Ismail outstanding legal counsel.”
ket. The firm also advised Tenaga Cable Although K Lim & Company is a relative-
Industries (a subsidiary of Malaysia’s largest ly young firm, the legal team has more than
power company) on a joint venture in Brunei. DF Abang Zen 35 years of collective legal experience covering
With the lateral hire of lawyers Irene DF Abang Zen is built on the reputation of jurisdictions including Australia, Brunei, the
Appaduray, Charles Lim from Abrahams Ferida Abang Zen, one of Brunei’s undisputed UK, Malaysia and New Zealand. The firm’s
Davidson & Co and Lim Chin Wah from leading lawyers and best known for her exper- experience spans banking and finance, corpo-
Kamarudin & Partners (a Malaysian firm), tise in shariah-compliant financial and com- rate law, insurance, and shipping and securi-
the firm gains further expertise across the mercial law. One interviewee sums up the ties.
board. general consensus: “Ferida always delivers.” Clients include domestic and international
The firm has worked with Baiduri Bank, banks, international trust companies, foreign
Leading lawyers Maybank and RHB Bank as well as a number missions, property developers, law firms and
Colin Ong of international law firms including Drew & motor vehicle distributors. The firm has
Napier, Mayer Brown JSM and Allens Arthur advised industrial clients Dowell
Robinson. Schlumberger Eastern, BAG Networks,
Ahmad Isa & Partners Brunei National Petroleum and San Hing
Ahmad Isa & Partners is a long-established Leading lawyers Developers, and was instrumental in the Hua
firm with a good reputation among both com- Ferida Abang Zen Ho Group’s $60 million capital-raising and
petitors and clients. “They do some excellent management of two large shopping malls in
work and have advised on a lot of cross border Brunei.
financings,” says a rival. “It is one of the Hale Zainidi Ong
favourites for foreign law firms to work with.” The law firm of Hale Zainidi Ong was formed Leading lawyers
Norton Rose is one such firm, and has con- by the merger of established firms S Ong & Kelvin Lim
www.iflr1000.com 2009 EDITION
Financial and corporate | Brunei 187
Pengiran Izad & Lee
According to a rival: “Pengiran Izad & Lee is
a trusted name in the market that is getting
stronger.” The firm plays an important role in
advising companies that the Brunei Economic
Development Board has attracted into the
country. Senior Partner Ronnie Lee is the
firm’s most visible and respected lawyer, and
draws particular praise: “He always did a great
job and I would say he lives up to his reputa-
tion,” says a recent client.
Though Pengiran Izad & Lee is renowned
for its banking work and advising on oil-and-
gas-related matters (for clients such as Shell,
Total and Brunei Petroleum), it also has a
strong practice in Islamic finance and foreign
investment. The firm acts for the Brunei
Association of Banks, which often seeks its
advice on new legislation. Pengiran Izad &
Lee also serves on a number of banking pan-
els such as HSBC, Standard Chartered Bank,
RHB Bank and Tabung Amanah Islam
Brunei.
Leading lawyers
Ronnie Lee
YC Lee & Lee
Best known as the legal advisor to Brunei’s
French and German embassies and the British
High Commission, YC Lee & Lee also advis-
es numerous banks and insurance companies
in Brunei. The firm has been very active this
year according to market commentators, par-
ticularly with mutual fund transactions. “YC
Lee makes this firm stand out. He is always in
demand,” says one rival. Clients agree, prais-
ing name partner Yew Choh Lee as “an excel-
lent legal adviser” who “excels at contentious
work and has a very strategic mind”.
Representative clients include Standard
Chartered Bank, HSBC, Bank Islam Brunei
Darussalam, Malayan Banking, Baiduri Bank,
Tabung Amanah Islam Brunei, United
Overseas Bank, Aiva Insurance, National
Insurance Company and Takaful BIBD.
Leading lawyers
Yew Choh Lee
2009 EDITION www.iflr1000.com
