ESR Filling Service

ESR Submission Services

Economic Substance Rules in the UAE

The United Arab Emirates (UAE) introduced a new regulatory mandate for companies registered in the nation known as the Economic Substance Regulations. Initially, the UAE Ministry introduced the Cabinet Resolution no. 31/2019 on 30th April 2019. Subsequently, the Ministerial Decision 215 of 2019 provided guidelines for this initial resolution’s implementation. Yet, changes were made on 10th August 2020 when the Cabinet Resolution 57/2020 was introduced, nullifying the previous Cabinet Decision no. 31/2019. Moreover, Ministerial Decision No 100 of 2020 replaced the previous Ministerial Decision 215 of 2019.

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  • Business Evaluation
  • Business Advisory
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  • ESR Submission
  • Detailed Investigation
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Which Activities Fall Under the UAE’s Economic Substance Regulations?

Companies across the UAE, encompassing the mainland, offshore ports, and the dedicated financial zones, are subject to the Economic Substance Rules. These companies must adhere to these regulations if their revenue originates from any of the subsequent activities:

  • Banking Operations
  • Insurance Operations
  • Investment Fund Management
  • Lease and Finance
  • Main Offices
  • Maritime Operations
  • Corporate Services
  • Real Estate
  • Distribution and Service Center Activities.

I hope this rephrased version serves your purpose. Let me know if there are any other adjustments you’d like!

All Licensees and Exempted Licensees must submit the ESR Notification annually with the following information:

  • Start and end dates of the financial year.
  • The specific activity being undertaken.
  • Whether revenue was derived from the aforementioned activity during the applicable financial year.
  • Any additional details required by the regulatory authority.

Exempted Licensee to also provide all the knowledge and documents for claiming the status of Exempted Licensee.

Notification must be filed within 6months from the top of its fiscal year & ESR Report must be filed with 12months from the top of its fiscal year of Licensee or exempted licensee.

Penalty for Not Submitting Economic Substance Notification On Time

Companies from the mainland, free zones, and offshore must adhere to the deadline for submitting the economic substance regulations notification. If they miss this timeline, they could face substantial fines ranging between AED 10,000 and AED 50,000. Additionally, providing inaccurate information in the notification can lead to similar fines. To steer clear of such complications, companies are advised to seek guidance from top ESR service providers in Dubai, UAE.

 

How Can Experts at TMK Assist You?

Our experts will conduct a preliminary check on your business on the applicability of Economic Substance Regulation.

Should your company fall under the purview of the Economic Substance Regulation, we are here to assist and advise on whether you meet the required criteria.

Should there be any shortcomings in meeting the standards, we identify those areas and offer recommendations to ensure you align with the UAE’s Economic Substance Regulation.

We extend our support in helping licensees submit the necessary Information Notification to the appropriate authorities.