Islamic Banking Act · 2024 Revised Edition · Part · Preliminary
2. Interpretation
Official textFrom Attorney General's Chambers, unchanged
In this Act, unless the context otherwise requires —
“agreement” means an agreement whether formal or informal and whether express or implied;
“associate undertaking” shall be construed in accordance with
Part 1 of Schedule 1;
“Authority” means the Brunei Darussalam Central Bank established by the Brunei Darussalam Central Bank Order, 2010
(S 103/2010);
[S 103/2010; S 17/2021]
“company” means a body corporate incorporated or registered in
Brunei Darussalam under the Companies Act (Chapter 39);
“controller” shall be construed in accordance with Part 2 of
Schedule 1;
“deposit liability”, without prejudice to section 103(3), means liability in respect of a deposit (as defined in subsection (3) of this section) including, where appropriate, a sum due as a debt to the Authority by virtue of section 62(4), and “depositor” and related expressions shall be construed accordingly;
“director” includes any person occupying the position of director of a company, whatever the title of his office, and includes a
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person in accordance with whose directions or instructions the directors of a company are accustomed to act and an alternate or substitute director;
“document” includes a circular brochure, pamphlet, poster, handbill, prospectus and other document which is directed at or likely to be read by members of the public; and also includes any newspaper, magazine, journal or other periodical publication;
“financing” means the extension of credit, loans, advances, murabahah, leasing, instalment sale, istisna’ or any other modality that is not contrary to Hukum Syara’;
“financing facilities” means —
the granting of financing and other facilities whereby a customer of the Islamic bank has access to funds or financial guarantees; or
the incurring by an Islamic bank of other liabilities on behalf of the customer;
“Hukum Syara’ ” means the Laws of Islam according to the
Syafeite, Hanafi, Maliki or Hanbali sect of the Ahli Sunnah
Waljamaah;
“institution” means a company incorporated or registered under the Companies Act (Chapter 39);
“Islamic bank” means a company which carries on Islamic banking business and holds a licence granted under section 4 or 23, and includes all branches and offices in Brunei Darussalam of any such company for the purposes of this Act;
“Islamic banking business” means business whose aims and operations are not contrary to Hukum Syara’ and which consists of receiving of deposits or other repayable funds from the public, paying or collecting cheques drawn by or paid in by customers, the granting of financing facilities to customers, and includes such other business as the Authority may authorise for the purposes of this Act;
“licence” means a licence granted under section 4 or 23;
“licensed moneylender” means a person licensed under section 3
of the Moneylenders Act (Chapter 62);
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“Minister” means the Minister of Finance and Economy;
“officer”, in relation to a company includes —
a director, the secretary or an employee of the company;
a receiver or manager of any part of the undertaking of the company appointed under a power contained in any instrument; and
the liquidator of the company appointed in a voluntary winding-up;
“owner of money” means the person who is entitled to the money
(or the person who would be so entitled except for the operation of the Limitation Act (Chapter 14)), and includes his executors, administrators and assigns and the lawful attorney or agent of such person, executors, administrators or assigns;
“parent undertaking” shall be construed in accordance with Part 3
of Schedule 1;
“place of business”, in relation to an Islamic bank, includes a head or main office, a branch, an agency, a mobile branch of the
Islamic bank, any office established and maintained for a limited period only and any other place used by the Islamic bank for the dispensing or acceptance of money on account or for the conduct of other Islamic banking business;
“public company”
means a company incorporated in
Brunei Darussalam under the Companies Act (Chapter 39) other than a private company;
“Registrar of Companies” has the same meaning as in section 2(1) of the Companies Act (Chapter 39);
“share”, in relation to an institution, means a share in the share capital of that institution and includes an interest in such share;
“subsidiary undertaking” (and references to a subsidiary) shall be construed in accordance with Part 3 of Schedule 1;
“undertaking” shall be construed in accordance with Part 3 of
Schedule 1.
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Without prejudice to any other meaning which the word
“insolvent” may have, an Islamic bank shall, for the purposes of this Act, be deemed to be insolvent if either it is unable to pay its debts on demand or at a time or in circumstances agreed by or on behalf of the persons making the payment and the person receiving it.
Subject to subsection (4), a “deposit” is a sum of money paid under an agreement which is in accordance with Hukum Syara’ on terms under which either the sum is paid for safe keeping and repayment on demand or at a time or in circumstances agreed by or on behalf of the person making the payment and the person receiving it, or for its investment for a fixed period and sharing the profits and losses of such investment between the person making the payment and the person receiving it.
Notwithstanding subsection (3), a sum of money is not a deposit if —
it is paid by way of advance or part payment for the sale, hire or other provision of property or services and is repayable only in the event that the property or those services is or are not in fact sold, hired or otherwise provided;
it is paid by way of security for payment for the provision of property or services provided or to be provided by the person by whom or on whose behalf the money is accepted;
it is paid by way of security for the delivery up or return of any property, whether in any particular state of repair or in any other manner;
it is a sum of money or financing made by a person, in the course of a business of financing money carried on by him, to any other person, except a licensed Islamic bank; or
it is a sum of money that is paid to an institution by a person who, at the time when it is paid, is a controller, director or manager of the institution, or a spouse, child or step-child of such a person.
For the purposes of this Act, “capital funds”, in relation to an
Islamic bank, means —
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if the Islamic bank is a company whose head office is situated in Brunei Darussalam the paid-up capital and published reserves of the company (excluding such reserves as the Authority may specify by notice in writing) deduction having been made for any loss appearing in the accounts of the
Islamic bank;
if the Islamic bank is a company whose head office is situated outside Brunei Darussalam, the net head office funds and such other liabilities as the Authority may decide:
Provided that, except for the purposes of section 11, in determining the capital funds of an Islamic bank at any time there shall be deducted any debit balance appearing in the Islamic bank’s profit and loss account.
In subsection (5)(a), “published reserves”, in relation to a company, means reserves which appear in its accounts but does not include any reserves which are represented by the written-down value of assets or by provision for the depreciation of fixed assets or which are maintained for any specific purposes.
In subsection (5)(b), “net head office funds”, in relation to an
Islamic bank incorporated outside Brunei Darussalam, means the aggregate of its issued and paid-up capital (or its equivalent recognised by the
Authority as applicable to the Islamic bank under the laws of the country or territory in which the Islamic bank is incorporated, formed or established)
and its published reserves as the Authority may specify in writing, deduction having been made for any loss appearing in the accounts of the Islamic bank.
Part 2
Part
Licensing of Islamic Banks
Part 7
Part
Reserve Funds, Dividends, Balance Sheets and Information
Part
Prohibited Business
Part
Minimum Assets Requirements
Part
Powers of Control Over Islamic Banks
Part
Overseas Branches and Representative Offices of Domestic Islamic Banks
Part
Unclaimed Balances
Part
Invitations to Make Deposits
Part