PAWNBROKER

 

 

1.                Is there any law in Brunei Darussalam that regulates the activities of a pawnbroker?

 

          The activity of a pawnbroker is governed under the Pawnbroker Order 2002.

         

An order to regulate the business of pawnbrokers in accordance with Hukum Syara' and shall apply to all persons whether or not professing the Islamic religion.

 

          The commencement date was on 1 August 2005.

 

 

 

2.                 Who is responsible to administer the Pawnbroker Order 2002?

 

The Permanent Secretary of the Ministry of Finance as the appointed Licensing Officer, is responsible generally for carrying out the provisions of the Order.

 

The Financial Institutions Division, MOF has been given the responsibility to carry out the regulatory and supervisory functions provided under the Order.

 

 

 

3.                 How can one apply for a pawnbroker license and how much is the licensing fee?

 

Application of license can be made to the Financial Institution Division, Ministry of Finance.

 

          A non-refundable application fee of BND100 is imposed for an application.

         

          Licenses is granted annually and a fee of BND5,000 is chargeable for every license.

         

          No person can carry on the business of a pawnbroker without a license.

 

 

 

4.                 What are the main conditions imposed under the pawnbroker license?

The pawn broker must provide a minimum paid-up capital of BND50,000 to carry out the business of a pawnbroker.

 

Applicant under sole proprietorship must be citizen of Brunei Darussalam, and for partnership or limited company, at least 50% share must be owned by citizen of Brunei Darussalam.

 

          Any other conditions as required by the Licensing Officer from time to time.

 

 

 

5.                 What type of security is required by an applicant to apply for a pawnbroker license?

 

Every pawnbroker shall provide security to the satisfaction of and in a manner determined by the Minister of Finance amounting BND100,000. Such security shall remain in force and shall continue for 6 months following the expiration or revocation of the license.

 

The security provided is to cover all damages and loss of whatsoever nature to or of any article provided to the pawnbroker.

                                                                       

 

 

6.                 What other requirements are needed once a license has been granted?

 

Every pawnbroker shall submit to the Licensing Officer a financial statement and audited accounts audited by a qualified auditor at the close of each financial year of the pawnbroker.

 

Every pawnbroker shall insure every article pawned in respect of all damages and loss of whatsoever nature.

 

 

 

7.                 What is the normal procedure of a pawnbroker business?

 

To conduct a pawnbroking business, an agreement has to be made between the pawned and the pawnbroker upon receiving a valuable article from the pawner by way of security and grants him a sum of money as a loan and undertakes to transfer such article back to the pawner on the repayment of the loan and other dues.

 

 

 

8.                 What is the amount of loan and redemption period provided under the Order?

 

 

The amount of loan shall not exceed BND5,000 in respect of any one article and shall be redeemable within a period of one year from the day of pawning either in a lump sum or by installment.

 

 

9.                 How much is the administrative expenses and fees for safe-keeping?

 

The administrative expenses and safe-keeping fees specified under the Order is from 25 cents to 50 cents per month for every BND100 of the value of the article pawned or such other amount as may be agreed between the pawnbroker and the pawner.

 

 

10.             If a pawner fails to repay the loan, can the pawnbroker sell or auction the pawned article?

 

If a pawner fails to repay the loan after the expiry of 6 months from the period of one year, the pawnbroker with the approval of the Syariah court, sell or auction the article pawned, by giving the pawner and the public reasonable notice of the sale or auction.

 

If the proceeds of the sale or auction are less than the amount due to the pawner, the pawner is still liable to pay the balance.

 

If the proceeds of the sale or auction are greater than the amount so due, the pawnbroker shall pay over the surplus to the pawner.

 

 

 

11.             What is the penalty imposed on a pawnbroker under the Order?

 

Any pawnbroker or pawner who willfully give false information, makes any fraudulent statement in any matter relating to the agreement of pawn or contravenes any of the provision of the Order shall be guilty of an offence.

 

Any person guilty of the above offence is liable on conviction to a fine not exceeding B$10,000 and to imprisonment for a term not exceeding 3 years.