Companies in the UAE must meet all due Legal compliances and abide by corporate governance regulations. Their dealings must be transparent and accountable, and their conduct must be ethically and legally above board. Companies in the UAE must be cognizant of and conscious of corporate governance and be fully compliant with Legal laws and regulations. you can reach out to us for Legal compliance services.
Failure to do so could result in their facing penalties and sanctions. The increase in the number of international regulatory compliances applicable in the UAE makes it challenging for companies to keep track of multiple deadlines amid the many operational demands on their time. Thats why we are here to help you with the help of Legal compliance services.
A few key regulatory compliances include:
- Economic Substance Regulation (“ESR”)
The Economic Substance Regulation (ESR) was introduced in the United Arab Emirates (UAE) in 2019 as part of the UAE’s commitment to addressing Base Erosion and Profit Shifting (BEPS) and to comply with the OECD’s recommendations on ESR. The ESR requires companies that operate in certain sectors to demonstrate that they have a substantial economic presence in the UAE. The ESR applies to companies that are incorporated or registered in the UAE, as well as foreign companies that have a branch or other form of presence in the UAE. The regulation primarily applies to companies engaged in activities such as banking, insurance, investment fund management, lease finance, headquarters, shipping, and holding company activities. The deadline for filing the ESR notification is within six months and the report is within 12 months from the end of the financial year of the company.
- Ultimate Beneficial Owner Regulation (“UBO”)
The Ultimate Beneficial Owner (UBO) regulation in the UAE is a set of rules and guidelines aimed at identifying and verifying the ultimate beneficial owners of companies and legal entities registered in the UAE. The UBO regulation was introduced as part of the UAE’s efforts to combat money laundering, terrorist financing, and other illegal activities. Under the UBO regulation, companies and legal entities registered in the UAE are required to maintain accurate and up-to-date records of their ultimate beneficial owners, including their names, nationalities, dates of birth, and residential addresses. The UBO is defined as the natural person who ultimately owns or controls the company or legal entity, either directly or indirectly, and includes those who hold more than 25% of the company’s shares or voting rights, or who have significant control over the management of the company. The UBO regulation is an important tool in combating money laundering and other illegal activities in the UAE, and it is essential that companies and legal entities operating in the UAE ensure that they are in compliance with the UBO regulation. The UBO information must be reported to the relevant authorities in the UAE, including the Registrar of Companies and the Anti-Money Laundering and Suspicious Cases Unit. Failure to comply with the UBO regulation can result in penalties, including fines and the suspension or revocation of licenses.
- Anti-Money Laundering Regulation (“AML”)
Anti-Money Laundering (AML) regulations in the UAE are rules and guidelines aimed at preventing the use of the financial system for money laundering and terrorist financing. AML regulations are designed to protect the integrity of the financial system and to prevent the proceeds of criminal activities from being used to finance illegal activities or to enter the legal economy. The AML regulations in the UAE are enforced by the Central Bank of the UAE, the Financial Services Regulatory Authority, and other relevant regulatory bodies. These regulations apply to a range of financial institutions, including banks, insurance companies, investment firms, and money exchange houses as well as non-financial institutions. Under the AML regulations in the UAE, financial institutions are required to implement a range of measures to identify and mitigate the risk of money laundering and terrorist financing. Failure to comply with the AML regulations in the UAE can result in significant penalties, including fines and imprisonment. Therefore, it is essential to ensure that they are in compliance with the AML regulations to avoid any legal or reputational consequences. AML regulations for DNFBPs are in place to prevent these businesses from being used for money laundering and terrorist financing activities. These regulations require DNFBPs to implement certain measures to identify and verify the identities of their customers, monitor and report suspicious transactions, and maintain records of their transactions.
At MNA, our team of expert lawyers enables our clients to focus on their business by ensuring that their compliance needs are met fully and quickly with:
- Regular updates on new regulations and changes
- Ensuring business conduct is aligned with the latest applicable laws and regulations
- Real-time tracking of all deadlines
- Submission of the required filings
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