Legal Market Overview
With a low cost of living and an affordable housing market, Brunei may not be comparable to Singapore or Hong Kong, but more than 35 years after its independence from the United Kingdom, it remains a politically and economically stable country. Notably, after decades of industrialisation based on its use of available natural resources, it has the second-highest Human Development Index in Southeast Asia and public debt is 0% of the national GDP.
In recent years, the Brunei government has continued its push towards modernisation with investment into technology, tourism, and banking and business services. The government is also keen to promote public-private partnerships, as well as further upgrade its road network and public transport system.
The country has not been as negatively affected as some other Southeast Asian countries in light of Covid-19. Nevertheless, there has been a drop in inbound investment and business in 2020. Foreign direct investments from China, refinery projects, and other major matters have been put on hold due to restrictions on travel, although some reports expect that there will be an economic rebound in 2021, and with that, an increase in banking activities. Additionally, Brunei has continued to pursue its strong economic relationships with Singapore and the Philippines.
It remains to be seen how strong public-private partnerships remain in Brunei, but its strategic location, aims towards continued modernisation, and readily available natural resources indicate it will continue to be an appealing place for foreign investment.
Due to its complicated history, Brunei currently is the only country in the region with a mixed legal system based primarily on English common law, with additional applications of Islamic sharia law. Local law firms frequently provide full-service advice for international clients, while international firms Eversheds Harry Elias LLP and Herbert Smith Freehills LLP have been active for some years in the market, especially regarding foreign investment.