A Business Owners Legal Guide
Directors of companies in Brunei Darussalam have significant responsibilities in terms of the management and operation of companies. Their duties are clearly defined under the Companies Act (Cap. 39) and other applicable legislation. When you are appointed as a new director — or considering the role — it is important to know what you must do so you can comply and not put your personal assets at risk.
1. Fiduciary Duties
Directors have fiduciary duties to the company, so must act:
In good faith and in the company’s best interests;
Honestly and forthrightly, free of any conflict of interest;
Faithfully and prudently, not using their position to enrich themselves.
If these duties are not adhered to, one could face legal action or disqualification.
2. Duty of Care and Skill
A director must:
Exercise due diligence, care and competence in a manner appropriate for the person’s position;
From the information available, decide on the best course of action;
Get expert advice when needed (such as legal, financial, or technical).
This duty obliges directors to act responsibly in managing affairs of the company.
3. Statutory Duties Under the Companies Act
In accordance with the Companies Act (Cap. 39), directors must: - Keep accurate books;
Please file your Annual Returns with the Registrar of Companies & Business Names (ROCBN);
Conduct Annual General Meetings (AGMs) as required;
Reveal any conflict of interest on transactions involving the company;
Do not commit any wrongful or fraudulent trading particularly in a situation where the company is also insolvent.
4. Employment & Immigration Compliance
In the event that the company hires local or foreign workers, directors are obliged to ensure: - There are proper employment contracts;
On-time salaries and statutory contributions;
Labour Department regulations compliance;
Work permits and employment passes for foreign workers.
5. Tax Obligations
Directors must ensure that:
The company submits tax return with Revenue Division, MOF;
Correct and timely submission of withholding taxes, employee CPF/SCP, and other taxes as applicable;
Any queries with the audit or investigation from the tax authority handled in an efficient and transparent way.
6. Business License Compliance
Directors must ensure that:
The company has valid business licenses from the relevant authorities;
It keeps the authorities updated about any modification to nature of business, address or ownership;
License renewal deadlines are met.
7. Liability and Penalties
Penalties for breach of these duties may include: - Fines, penalties or disqualification from appointment as director;
Personal liability for the debts of the business in cases of negligence or fraud;
Criminal charges for egregious cases of willful misconduct or fraudulent activities.
The seriousness of the role of a director in Brunei has serious legal implications. It is more than just a title — it includes actively participating in the company’s operations and ensuring compliance with statutory and regulatory requirements. Directors should remain informed and seek professional advice where needed, to ensure they meet their responsibilities and safeguard the reputation of the company.
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✍️ Written by: Faisal Kv
Corporate Compliance Specialist | Mercium Sdn Bhd, Brunei Darussalam