Your Guide to Compliance Services in UAE

CbCR is designed to promote transparency in the global taxation landscape. It obliges multinational enterprises (MNEs) to furnish detailed information on their worldwide operations, encompassing revenue, profits, taxes paid, and other essential financial and operational data, broken down for each individual country where the MNE group operates. This reporting provides a comprehensive overview of the MNE group's global activities, including details on revenue, pre-tax profit or loss, income taxes paid and accrued, stated capital, retained earnings, tangible assets, and the number of employees, all reported on a country-by-country basis across all jurisdictions where the MNE group has a presence.

The UAE government introduced the Economic Substance Regulations (ESR) on April 30, 2019, through Resolution No. 31/2019. These regulations were put in place to align with the OECD Inclusive Framework and address concerns raised by the European Union Code of Conduct Group on Business Taxation regarding the UAE's tax framework. ESR applies to specific business activities like banking, insurance, and shipping, whether conducted in Freezone or Mainland jurisdictions.These regulations are applicable to all UAE-based entities, including onshore and free zone companies, branches, representative offices, and other licensed business entities involved in one or more of the "Relevant Activities" that generate revenue.

The United Arab Emirates has replaced Cabinet Resolution No. 34 of 2020 with Cabinet Resolution No. (58) of 2020, which governs Beneficial Owner Procedures. This updated Resolution aims to ensure greater transparency among UAE-registered entities by requiring them to disclose their Real Beneficiaries or Ultimate Beneficial Owners, aligning with international standards. The objectives of the Ultimate Beneficial Owner (UBO) framework include meeting international economic requirements, setting minimum disclosure obligations for Beneficial Owners, Shareholders, Partners, and Nominee Board Members, and establishing an effective regulatory mechanism to combat Money Laundering and Terrorist Financing.

Money laundering is the covert and unlawful process of concealing ill-gotten gains, whether by individuals or organizations, with the aim of acquiring assets, property, or services for personal or business advantages. Compliance with UAE Law No. 20 of 2018 on AML is obligatory for various entities, including accountants, auditors, real estate agents, precious metal dealers, and corporate service providers. The UAE is dedicated to global AML and CFT efforts, aligning with international standards set by the Financial Action Task Force (FATF). This federal law applies not only to financial institutions but also to designated non-financial businesses and professions (DNFBPs).