Ultimate Beneficial Ownership (UBO) registers in the UAE
The UAE government introduced new regulations in August 2020 requiring companies registered and licensed in the UAE to maintain and submit registers of their i) ultimate beneficial owners (UBOs or Real Beneficiaries) ii) shareholders and iii) nominee directors.
The legislation was introduced to combat tax avoidance and criminal activity, and provide greater transparency to the UAE’s business sector.
Who is an Ultimate Beneficial Owner (UBO)?
- A UBO is a natural person(s) who owns or controls at least 25% of a company’s shares, directly or indirectly. Companies can have more than one UBO.
- If no such person is identified, the UBO is a natural person who exercises control over the company, and
- In the absence of any of the above, the real beneficiary is the senior manager of the company.
What UAE companies do these new regulations apply to?
- All i) mainland ii) commercial free zone and iii) offshore companies.
- The exceptions to the above are i) companies established in the UAE’s financial free zones (Abu Dhabi Global Market (ADGM) and Dubai International Financial Centre (DIFC) or ii) companies, wholly owned directly or indirectly by the federal or local government and their subsidiaries.
What registers do UAE companies need to maintain?The company must maintain i) a Register of Beneficial Owners ii) a Register of Shareholders or Partners and iii) a Register of Nominee Directors.
What information should be included in these registers?
- The Registers should include i) name ii) nationality iii) passport details iv) date and place of birth v) address vi) date when the individual became a UBO and/or the date upon which the individual ceases to be a real beneficiary.
- The Register of Shareholders should include i) the number of shares held by each shareholder ii) voting rights of the shares iii) date of acquisition of shares and iv) information on all parties.
- The company is also required to appoint and disclose details of a natural person (known as an authorised agent) residing in the UAE who is authorised to disclose the company’s data and information required under the resolution.
- Companies must notify the Registrar of any change or amendment to the information provided within 15 days of the change or amendment.
- The Registers must be maintained through the life of the company and for five years after its closure.
- Information contained in the registers is kept confidential by the Registrar.
What happens if the company does not meet these requirements?
- Sanctions and/or administrative penalties may be imposed on the entity.
- The UAE Ministry of Economy has not yet published the list of administrative penalties.
ConclusionPlease contact Healy Consultants Group PLC to assist your UAE company comply with this regulation.