Ultimate Beneficiary Owners – Deadline 30th June 2021:
The United Arab of Emirates has replaced Cabinet Resolution #34 of 2020 with Cabinet Resolution #58 of 2020 which regulates Beneficial Owner Procedures (herein referred to as the “Resolution”).
The Resolution covers the updated requirements for the registered entities in UAE to disclose their Real Beneficiary Data or Ultimate Beneficial Owners to increase the transparency of the entities. It also intends to improve the International Compliance and global confidence while controlling Money Laundering and Terrorist Financing.
As per the Cabinet Resolution #58, all UAE registered entities must perform the following:
- Maintain the following:
- Partners/Shareholders Register (state the information about the ownership interests and voting rights held by each individual).
- Real Beneficiaries (provide the reason behind being Real Beneficiaries and the date they termed as one).
- Directors and Nominee Directors.
- And other important documents and UBO forms submitted to authorities.
- Notify the relevant authority of any changes regarding the initial information given, within fifteen (15) days of such change. Establishments are also required to appoint a person residing in UAE as a point of contact, so the licensing authority can contact that person regarding the UBO data and any other basic information requirement.
- Entering Ultimate Beneficial owner data in the systems of licensing authorities and keep updated regarding any communication from authorities to avoid penalties.
Identifying Ultimate Beneficial Owner:
As per Cabinet Resolution #58 of 2020, Beneficial Owner or Real Beneficiaries can be the following:
- Natural Person who owns/controls the establishment definitively, through direct/indirect ownership shares of 25 % or more.
- Or: someone who holds the right to vote by 25% or more or the right to appoint/dismiss the majority of the establishment’s managers or any other means by which he exercises ultimate control over the establishment.
- In cases where UBO cannot be identified through the two conditions above, then a natural person who holds the position of Senior Management Official in the company may be deemed as the UBO.
The entities will need to assess who counts as a UBO and consider whether if anyone is a nominee Director / Manager. The Register of Shareholders / Partners isn’t a new concept as this is a requirement outlined in the UAE Commercial Companies Law, as well as in respective Free Zone Companies Regulations. However, the New Resolution requires additional information to be detailed (for example, voting rights).
Exemptions of The Resolution:
As per Cabinet Resolution #58 of 2020, following entities are exempted from the Resolution:
- Companies in financial free zone like Abu Dhabi Gold Markets and Dubai International Financial Center.
- Companies which are directly or indirectly owned or affiliated with the Federal or Emirate Government.
Failure To Comply With The Resolution:
If entities fail to comply with the Resolution, the UAE Ministry of Economy has announced to Impose AED 100,000 penalty for non-compliance.
The UAE Ministry of Economy has posted the deadline as 30th June 2021. However, some relevant authorities have also announced earlier deadlines. So, its wise to check with your license issuing authority to avoid missing the deadline.
How can we help?
- Bestax Chartered Accountants will prepare all the needed documents, and submit them before the given deadline, so your entity can avoid getting a penalty.
- We will ensure the filing of declaration of UBO is done effectively, so you do not have to worry about it.
- We will also take care of any changes and notify the relevant authorities, so you will not have to worry about it.
All in all, Bestax Chartered Accountants will handle all the tasks efficiently, so you won’t have to deal with the headache of fulfilling it.