UBOs are natural persons who own and control companies directly or indirectly. A UBO is anyone with more than 25% ownership or voting power in a company, as well as those who are able to dismiss or appoint a majority of the company’s directors.
The UAE government had passed a Cabinet resolution in this regard. This resolution aims to increase corporate transparency by regulating Ultimate Beneficial Owner Procedures. The resolution covers UBO guidelines for new companies and existing companies. All UAE mainland and free zone legal entities will be affected by the resolution (with a few exceptions). This resolution focuses on the requirement to prepare and maintain an Ultimate Beneficial Ownership (UBO) register.
The register must always be readily accessible at an entity’s office. A copy of the register must also be filed with the relevant authorities, and any modifications must be reported to the authorities. This declaration was made to reduce the risk of monetary fraud at the corporate level. Financial and economic crimes can be committed by unregulated entities that are harmful to the business climate of a country. Financial crimes, fraud, and money laundering are reduced as a result. It increases transparency at a corporate level.
Keeping a beneficial ownership register has become a legal and obligatory requirement, we undertake the hardships behind this on your behalf and simplify the procedures as we are expertised in the field and make your registration process on time and accuracy.
A company’s UBO can be identified through any arrangement, according to the resolution. It is essential that a company always maintains an updated record of a UBO’s details once a UBO has been identified.
Under the resolution, all UAE-licensed entities must declare their UBO. Exceptions are as follows:
The resolution does not require free-zoned entities to declare their UBO. Contact your desired free zone’s client relations team to learn more about the UBO declaration.
Any change of ownership of a business must be notified to the Registrar within 15 days of the change.
If the details are submitted when the company is incorporated, subsequent compliance would happen only after UBO changes as UBO is once-off compliance. At present, offshore companies are not exempted from compliance requirements and must adhere to them as well.
The failure to comply with this law will have consequences for legal entities. Sanctions will be imposed by the Ministry of Economy. Following the issuance of sanctions, the legal entity will have the opportunity to appeal and have the sanctions lifted following the appeal process.
However, professional help from an expert like us can simplify the UBO registration process. We can ensure that you meet all requirements timely without your head whirling.