Brunei E-Commerce

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Brunei E-Commerce Legislation

A commercial code for electronic transactions was enacted in the Electronic Transactions Order 2000. This commercial code draws from the UNCITRAL Model Law on Electronic Commerce and the Singapore Electronic Transactions Act, itself based on the US Uniform Electronic Transactions Act.

The Act deals with legal aspects of how a contract can be formed electronically and the use of digital signatures, the status of secure electronic records, authentication and non-repudiation of public key infrastructures by Certification Authorities and cross certification of foreign CAs.

The legislation also contains an omnibus provision through which Government departments and statutory boards can accept electronic filings without the need to amend their respective Acts, Emergency orders or regulations. The provision will also allow these bodies to issue permits and licences electronically.

The Electronic Transactions Order 2000 was approved by His Majesty Sultan of Brunei on 20 November, 2000 and published by the Government on 16 December, 2000.

The Broadcasting (Class License) Notification, 2002 and The Internet Code of Practice Notification, 2001 are now also operative to deal with Internet Content Providers.

Brunei Telecommunications

Telecommunications were first introduced to Brunei Darussalam as early as 1920 with the installation of international wireless telegraph circuit linking Brunei Darussalam to Labuan. The first telephone service was introduced in the 1930s linking the British Residence Office and his residence.

Jabatan Telekom Brunei was established as a government department in 1952 and has been responsible for the development of communication systems and infrastructure and for the drastic transformation in telecommunication services especially after the county’s independence in 1984.

Presently, Brunei Darussalam has one of the most advanced telecommunication facilities in this region with the fixed line telephone density second only to Singapore. Brunei Darussalam has an extensive network of external plant consisting of copper and fibre optic cables, completely digital exchanges with adequate international connectivity via the satellite system and the fibre optics submarine cable systems.

In preparation for the corporatisation of JTB, Telekom Brunei Berhad (TelBru) was established in June 2002. Under the Telecommunication Successor Company Order, TelBru was the designated telecommunication successor company to take over the operations of telecommunication services from JTB on the date of corporatisation.

A regulatory body, the Authority for Info-Communication Technology Industry of Brunei Darussalam (AiTi) was also established to administer the regulatory function and development of the Info-Communication industry in Brunei Darussalam.

The Authority for Info-communications Technology Industry of Brunei Darussalam (AiTi) was established under the Authority for Info-communications Technology Industry of Brunei Darussalam Order 2001. AiTi began operating on 1st January 2003.

The functions and duties of AiTi are stated in Section 6 of the AiTi Order 2001. The core functions of AiTi are:

to exercise licensing and regulatory functions with respect to telecommunication system and services in Brunei Darussalam;
to efficiently manage the national radio frequency spectrum;
to contribute towards diversification and development of the economy through the development and growth of the ICT industry of the country.

From March 2007, the E-Government Technical Authority Body (EGTAB) was formed to function as the e-government “Think Tank”.

EGTAB's Functions are:

Think-Tank

Advisory Role

Program Management

Secretariat

ICT Industry Development Role

ICT Human Capacity Development Role

EGTAB's Vision:

To serve as ICT Technical authority in developing technical policies and setting standards, having the legitimate authority to enforce and drive the implementation of the strategic directions

To facilitate inter-agency projects collaboration between Ministries to enable e-Government system integration

Brunei Offshore Activities

The natural bonding of the Internet and Offshore stems from the fact that both, of their nature, manage to avoid tax. Businesses which can operate on the Internet without, so to speak, touching ground in a high-tax jurisdiction will naturally migrate to offshore jurisdictions; while business that already have offshore existence will find it highly convenient to be able to use the Internet to trade with their high-tax customers without having to make a landing in their countries.

As a major offshore jurisdiction, it is only a matter of time before Brunei Darussalam becomes a centre of e-commerce activity. The island's geographical location, its good telecommunications links and its sophisticated business infrastructure add to the inevitability of an e-future for Brunei.

By locating websites in Brunei to carry out functions previously based in high-tax jurisdictions such as sales and marketing, treasury management, supply of financial services, and most of all, the supply of digital goods such as music, video, training, software etc, businesses can take advantage of low rates of taxation for increasingly substantial parts of their operation.

In many countries, the distribution of goods from a warehousing facility does not constitute the carrying on of a trade or business in that jurisdiction, so that even for physical goods, in many case it will be possible to avoid a permanent establishment (taxable presence) altogether in many high-tax jurisdictions where trading activities currently take place.

For information about the impact of e-commerce on a number of the main offshore activities which take place in Brunei, click on a link below to go to our specialist E-commerce site Offshore-e-com.com

Sales and Distribution of Physical Products
Sales and Distribution of Digital Products
Banking and Financial Services (including Investment Funds)
Corporate Support Functions

To see an analysis of the current state of legal and tax issues surrounding offshore e-commerce, click here.

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Brunei: E-Commerce

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