Section 20

Every takaful operator registered under this Order shall establish and maintain in accordance with this section a takaful fund in respect of the class or each of the classes of takaful business carried on by the takaful operator in Brunei Darussalam so far as that business relates to Brunei Darussalam certificate.

Incorporating amendments until S 1/2016

(Clean Version) NANI/Amiriah/Fiqah/Karimah as of 8th July 2019

20

BLUV as at 14th January 2016

The Authority may require any takaful operator to establish and maintain, in addition to the takaful funds under subsection (1) such other takaful fund as the Authority may determine for different types of certificates in respect of each class of business.

There shall be paid into a takaful fund all receipts of the takaful operator properly attributable to the business to which the fund relates (including the income of the fund), and the assets comprised in the fund shall be applicable only to meet such part of the takaful operator’s liabilities and expenses as is properly so attributable.

In the case of a fund established in respect of family takaful business, no part of the fund shall be allocated by way of benefits to participating certificates, except with the approval of an actuary and out of a surplus of assets over liabilities as shown on the last statutory valuation of the fund; and on the making of any such allocation that surplus shall be treated for the purposes of this section as reduced by the amount allocated.

If on the last statutory valuation in the case of a fund established in respect of family takaful business there was shown a surplus of assets over liabilities of the fund, there may, subject to the approval of an actuary and to any provision to the contrary in any instrument or contract binding the takaful operator, be withdrawn from the fund an amount not exceeding the surplus, and on the making of any such withdrawal that surplus shall be treated for the purposes of this section as reduced by the amount withdrawn:

Provided that no part of the surplus attributable to a participating certificate other than a re-takaful certificate shall be withdrawn in excess of one-quarter of the amount allocated thereout by way of benefits to participating certificates.

If in the last statutory balance sheet in the case of a takaful fund established in respect of general business there was shown a surplus of assets over liabilities of the fund, there may, subject to any provision to the contrary in any instrument or contract binding the takaful operator, be withdrawn from the fund an amount not exceeding the excess of the surplus over any fund margin of solvency prescribed for that fund under section 21, and on the making of

Incorporating amendments until S 1/2016

(Clean Version) NANI/Amiriah/Fiqah/Karimah as of 8th July 2019

21

BLUV as at 14th January 2016

any such withdrawal that surplus shall for the purposes of this section be treated as reduced by the amount withdrawn.

In respect of any certificate belonging to the takaful operator’s family takaful business which is under section 19(4) removed from the takaful operator’s register of Brunei

Darussalam certificates, there may be withdrawn from a takaful fund to which the certificate relates an amount not exceeding the prescribed amount.

Any amount withdrawn from a takaful fund under subsections (5), (6) or (7)

and, in a winding-up, any part of a takaful fund remaining after meeting the liabilities and expenses to which the fund is applicable may be dealt with as if it had not formed part of the fund except that, in the case of a winding-up where any other takaful fund of the takaful operator under this Order is in deficit, the surplus remaining after the winding-up shall first be applied to make good the deficit in that fund.

In a winding-up, assets comprised in the deposit made by a takaful operator under section 16 in respect of either class of business may be allocated by the Authority to any takaful fund established by the takaful operator for that class of business in such manner and proportion as he sees fit, and assets so allocated shall be treated as assets of the takaful fund, and subsections (3) and (8) shall apply to those assets accordingly.

Any takaful fund established by a takaful operator for any class of business shall, notwithstanding that the takaful operator at any time ceases to carry on that class of business in Brunei Darussalam, continue to be maintained by the takaful operator so long as the takaful operator is required by this Order to maintain the register of certificates belonging to that class.

In the case of an existing takaful operator, a takaful fund shall be established as at the date of establishment of the register under section 19(9) and by reference to the certificates registered or required to be registered in it as at its establishment, and by reference to the assets and liabilities of the takaful operator as at that date; and –

Incorporating amendments until S 1/2016

(Clean Version) NANI/Amiriah/Fiqah/Karimah as of 8th July 2019

22

BLUV as at 14th January 2016

The amounts referred to in subsection (11)(a) are –

Any person who fails to comply with this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000, and in the case of a continuing offence to a further fine not exceeding $10,000 for every day during which the offence continues after conviction.

Paid-up capital and margins of solvency.