Let us guide you through complex business regulations
Our team of professionals is well-equipped to assist you in understanding and complying with various regulatory requirements for businesses.
Our Mandatory Compliance Services
Our specialists are committed to helping you through the UAE’s regulatory requirements for businesses, including Economic Substance Regulations (ESR) and Ultimate Beneficial Owner (UBO).
ESR
The Economic Substance Regulations require UAE companies to maintain adequate economic presence relative to their activities. Our team will review your business to assess if you meet the ES Test. If you do, we’ll file the ES Notification and ES Report on your behalf.
UBO
UBO (Ultimate Beneficial Owners) registration is mandatory for mainland and free zone companies in the UAE, except for those licensed in certain jurisdictions or owned by the government. Our team will help you complete your UBO declaration for full compliance with UAE laws.
But it doesn’t have to be this way.
Before you do anything, talk to one of our experts in Dubai. We’ll show you how easy the process is and why we’re the partner of choice for entrepreneurs who want to establish a business in Dubai.
Our Rates
Our team is dedicated to helping you maintain compliance with UAE regulations so your business can avoid government fines and penalties
- ESR Assessment
Annual rates
AED 949.00
- ESR Notification Filing
AED 1,249.00
- ESR Report Filing
AED 1,249.00
- UBO
AED 525.00
- goAML Registration
AED 2,625.00
* All rates are inclusive of 5% VAT.
Your Guide to Business Compliance Services in UAE
Operating a business in the UAE can be daunting due to the numerous laws and regulations one must abide by. However, there are business compliance services available to assist in this regard.
A good business compliance service will help ensure that your business practices are legal and correct, and they will keep you up-to-date on all the latest changes to the law.
If you’re looking for reliable business compliance services in UAE, read on! We’ll provide you with all the necessary information on business compliance in Dubai.
What Is Business Compliance?
Business compliance refers to ensuring that your business operations comply with the law. This means ensuring you know all the relevant laws and regulations and taking necessary measures to comply with them.
Keeping track of the multiple laws and regulations applicable to your business can take time and effort. However, our business compliance service can assist in simplifying the process.
Why Do I Need Business Compliance Services?
If you’re operating a business in the UAE, having a reliable business compliance service is important. The UAE has many intricate laws and regulations, and failure to comply with them can result in severe penalties. In fact, penalties in the UAE can be much harsher than in other countries and may include imprisonment, substantial fines, and limitations.
What Do I Need to Know About Business Compliance Services in UAE?
You should be aware that there is no standard for business compliance services in the UAE, so it’s crucial to ensure that you select the right service for your business.
Important questions to ask a potential compliance expert in Dubai should include:
- What services do you offer?
- Are you familiar with the laws and regulations in the UAE?
- How often do you update your clients on changes to the law?
- Do you have any case studies or success stories from previous clients?
These questions will help you determine whether a particular compliance service is right for your business.
Business Compliance Issues
Compliance with legal regulations is crucial for businesses to avoid legal issues, fines, and imprisonment. Prioritizing adherence to ethical standards and industry-specific laws is essential for maintaining a positive reputation and ensuring long-term success.
Some examples of noncompliance with Dubai law are as follows:
- Operating without a valid trade licence
- Not registering employees with the Ministry of Human Resources and Emiratisation (MOHRE)
- Trading in banned goods or services
- Failing to pay taxes
These are just a few examples.
It’s important to note that certain goods are banned in the UAE, such as alcohol, pork products, weapons, and drugs. A business can get into legal trouble if they serve alcohol at a work reception or offer ham sandwiches, even though it seems like a minor issue. Keep in mind that Dubai is one of the Emirates in the UAE, and it has its own laws and regulations that differ from those of other Emirates.
Operating Without a Valid Trade Licence
It is a common mistake made by businesses in Dubai to not register their employees with the Ministry of Human Resources and Emiratisation (MOHRE). All employees must be registered with MOHRE regardless of their nationality or visa status. The penalties for violating these laws can be quite severe. For instance, operating without a valid trade license can result in a fine of up to AED 200,000 and/or imprisonment for up to two years. Additionally, a 250 AED fine may be imposed if a trade license is not renewed.
Trading in Banned Goods or Services
Trading in banned goods or services is a common offence that can lead to significant fines. Knowing what products and services are prohibited is crucial to avoid penalties. Some items, such as alcohol and pork, may come as a surprise.
In 2020, several old laws were decriminalized, including drinking alcohol without a license. However, alcohol consumption is still limited to private homes and licensed public areas. In the UAE, individuals must drink legally at least 21 years old.
Therefore, if you want to trade alcohol, your business must be fully licensed, even though the regulations on drinking have been somewhat relaxed.
Failing to Pay Taxes
Failing to pay taxes is considered an offence that may lead to imprisonment for up to six months and/or a fine of AED100,000. It is crucial to be aware of your tax obligations to avoid any legal troubles.
It is important to note that tax regulations differ in Dubai Free Zones compared to the rest of the UAE. Moreover, new tax regulations will be imposed by the UAE in 2023.
How Can Gulf Gateway CSP Business Compliance Services Help?
Our business compliance service is designed to provide guidance through the complex laws and regulations in the UAE. We understand the importance of staying up-to-date with any changes to the law, and we will keep you informed to ensure that you will be aware of unexpected changes.
In addition, we can assist you with other areas of compliance, such as registering employees with MOHRE, obtaining a trade license, and filing tax returns.
UBO and ESR: What You Need to Know
Economic Substance Regulations (ESR)
The ESRs require companies operating in the UAE to preserve a strong UAE economic presence. This is to show that the company’s financial status is transparent and that offshore accounts are not being abused.
If your company earns income from any relevant activities, fulfilling the annual filing requirements is mandatory. Failure to comply with the law could result in penalties for your company.
“Relevant Activities” under this law include:
- Shipping
- Insurance
- Banking
- Holding company
- Intellectual property
- Lease-finance
- Investment fund managing
- Distribution or servicing centre
- Headquarters
It is important to note that if any of the listed activities serve the same function, they would still be considered Relevant Activities under the law, regardless of what name they are called. Additionally, no income threshold exempts individual UAE entities from complying with the law, regardless of size.
If your company conducts any relevant activities, it must file them within six months before the end of the financial year on the Ministry of Finance’s (MoF) ESR portal. You must indicate which activities were conducted, the income earned, and whether or not this income was taxed outside of the UAE.
Companies with income from Relevant Activities must then demonstrate that they have sufficient economic substance in the UAE. To do so, you must satisfy the following Economic Substance Tests:
- Core Income Generating Activity Test
- Directed and Managed Test
- Adequacy Test
If considered high-risk, companies undertaking intellectual property activities must undergo enhanced Economic Substance Tests. The impact of COVID-19, such as travel restrictions, must also be taken into account, but companies should carefully review the facts and ensure that their documentation reflects any changes made.
If your company has earned income from Relevant Activities, it is mandatory to submit a report through the MoF online portal within 12 months from the end of the related financial year. During this period, your company will be required to disclose a lot of information, including:
- Whether Economic Substance Tests were completed
- Details surrounding outsourced providers
- Operations expenditure and number of full-time employees per Relevant Activity
Companies must be transparent with their financial status to avoid complex corporate arrangements that may lead to fraud, tax evasion, money laundering or concealment of wealth. A strong economic presence in the UAE demonstrates that the company is not trying to hide any assets.
If your company is involved in any of the Relevant Activities listed, it must file the necessary documents on the Ministry of Finance’s ESR portal within six months before the end of the financial year.
Our team at Gulf Fateway CSP can help you check whether or not you’re meeting the Economic Substance Tests requirements. If you do meet the requirements, we can also help you file the ES Notification and ES Report.
Ultimate Beneficial Owners (UBO)
An Ultimate Beneficial Owner (UBO) is an individual who benefits the most from a transaction made by an organization. The definition of a UBO may vary depending on the jurisdiction, but it typically refers to a specific person who holds capital or voting rights in the parent company.
Generally, this is the person who owns or manages their own company.
To identify UBOs, a bank will:
- Obtain and review the organization's credentials
- Look at the chain of ownership
- Determine who falls under the definition of UBO
- Perform an AML or KYC check
To comply with UBO regulations, it is necessary to register your UBOs. Article five of the UBO regulations outlines the process for determining who your UBO is before the bank does.
Your UBO should have the power to vote, own, or control at least 25% of the company’s shares, directly or indirectly. They may also have the authority to appoint or dismiss directors and managers within the company.
If no one in the company meets these criteria, then the UBO is whoever exercises the most control over the company. If there is still uncertainty, the UBO will be the person responsible for senior management.
Next, the company must maintain a register of nominee directors and managers. This register must provide detailed information about the nominated individuals and should include information about acting on behalf of a third party’s instructions.
A company needs to maintain a register of its shareholders, which includes the number of ownership interests held by each shareholder, as well as the details of their voting rights and the date on which these rights were acquired. This information is essential for ensuring that the correct Ultimate Beneficial Owner (UBO) is identified during the registration process and also helps the company to comply with the laws, such as the Commercial Companies Law.
Regulators have focused on combating money laundering and terrorism financing for the past few decades. Some fraudulent groups use offshore accounts to conceal their financial activities. In such cases, investigators track any suspicious transactions, which often lead to fake addresses, fictional PO boxes, or the addresses of individuals who are not involved. Therefore, UBO regulations have been introduced across the world, including the UAE, to address such issues.
Every company has a specific risk with these issues, so it’s crucial to take measures that mitigate the risk! The UAE requires that Ultimate Beneficial Owners are registered so that transactions are transparent across all free zones and mainland operating companies.
These regulations are put in place to ensure that you know who you are doing business with, avoid criminal transactions, and stay within the confines of UAE law.
Our team can help you easily register your UBO and complete the UBO declaration. We offer mandatory compliance services that ensure your business operates within the confines of UAE law, helping you avoid fines and penalties from the government.
Book a consultation with one of our professionals today so that you can get started!
The Importance of Business Compliance
Gulf Gateway CSP can assist you in searching for top-notch business compliance services in Dubai. We have a team of proficient experts who possess comprehensive knowledge about the laws and regulations in the UAE. They can guide you to ensure your business stays compliant with the rules and regulations of the region.
Gulf Gateway CSP can assist you in searching for top-notch business compliance services in Dubai. We have a team of proficient experts who possess comprehensive knowledge about the laws and regulations in the UAE. They can guide you to ensure your business stays compliant with the rules and regulations of the region.
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United Arab Emirates
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