CORPORATE COMPLIANCE SERVICES

UBO DECLARATION

Introduction of UBO Regulations

The United Arab Emirates (UAE) introduced a significant legal framework aimed at enhancing corporate transparency and combating financial crimes through Cabinet Resolution No. 58 of 2020 on the Regulation of the Procedures of the Real Beneficiary. This pivotal regulation requires all entities registered in the UAE, except those wholly owned by the federal or local government, to identify, maintain, and report the details of their Ultimate Beneficial Owners (UBOs) to the relevant regulatory authorities.

Compliance Requirements and Enforcement

The introduction of UBO regulations marks a critical step in the UAE’s ongoing efforts to align with international standards against money laundering, terrorist financing, and tax evasion. The UBO is defined under this legislation as any natural person who ultimately owns or exercises control over a company. This control can manifest through direct or indirect ownership of more than 25% of the company’s shares or voting rights, or by having significant influence or authority over the company’s management or operations.

Companies are mandated to establish and maintain a detailed register of their UBOs, including comprehensive information such as full names, nationalities, dates of birth, residential addresses, and the nature and extent of the beneficial interest held. This register must be updated regularly and any changes in beneficial ownership must be reported to the relevant UAE registry within 15 days.

Compliance with the UBO regulations is strictly enforced. Entities that fail to comply may face significant penalties, including financial fines, the suspension of business licenses, and other disciplinary actions. These stringent measures reflect the UAE’s commitment to ensuring a transparent, secure, and reliable business environment.

Significance and Implications of UBO Regulations

Cabinet Resolution No. 58 of 2020 embodies the UAE’s dedication to preventing the misuse of corporate entities for illicit purposes. By requiring companies to disclose their ultimate beneficial owners, the UAE aims to fortify its financial system against global financial crimes, thereby enhancing its reputation as a leading financial center. This regulation is a testament to the UAE’s resolve in promoting corporate transparency and integrity, ensuring that the country remains in compliance with global financial regulatory standards.

Legal Compliance and Disclaimer

Our guidance on the Ultimate Beneficial Owner (UBO) declaration is anchored in the UAE’s stringent regulatory requirements, primarily outlined in Cabinet Resolution No. 58 of 2020 concerning the Regulation of the Procedures of the Real Beneficiary. This, along with relevant circulars and guidelines issued by the UAE Ministry of Economy and other regulatory authorities, forms the legal basis of our advisory services related to UBO declarations. By adhering closely to these directives, we ensure that our guidance is both precise and compliant with the UAE’s efforts to enhance transparency, prevent financial crimes, and align with international standards on beneficial ownership disclosure, thereby offering our clients dependable support in meeting their UBO declaration obligations.

The information provided does not constitute a direct or implied recommendation or endorsement of any strategy, decision, or action. Clients are encouraged to consult with the tax, legal, or professional advisors to determine the applicability of the information to their specific circumstances. Europe Emirates Group expressly disclaims any liability for errors or omissions in this information or for any loss or damage suffered by any person as a result of reliance on the information provided. Use of and reliance on the information is at the user’s own risk.