What’s new?
The DIFC Authority issued an announcement updating its Licensees on the ESR notification procedure and deadline.
What does this mean in practice?
According to the DIFC announcement:
- All DIFC Licensees (and not only the ones conducting a Relevant Activity) are required to submit an economic substance notification on the DIFC Portal;
- The 31 March 2020 notification deadline previously advised by the DIFC has been postponed;
- The Ministry of Finance is expected to issue a ‘Relevant Activities Guide’ which should assist the DIFC Licensees in determining whether their businesses conduct a Relevant Activity and falls within the scope of the ESR;
- Once the Relevant Activities Guide has been issued by the MoF, the DIFC will make the requisite notifications available on the DIFC Portal and issue a communication to all DIFC Licensees about the notification process and deadlines involved;
- Information relating to the Economic Substance Return (for the Licensees falling within the scope of the ESR) will be issued in the second half of 2020.
Guidance with respect to time, form and method of submission for the notifications and reports have been eagerly awaited.
It is expected that other Authorities will follow the same directives above and will wait for the MoF’s Relevant Activities Guide before publishing their respective ESR notification procedures and deadlines.
It is paramount that any affected Licensee assesses its existing situation, and makes sure that it is compliant with ESR in order to avoid penalties.
How can we help?
Understanding ESR is the first step towards ensuring you make the right decisions for your company.
Is your entity in-scope of the new legislation? If so, is it conducting one (or more) of the listed Relevant Activities? Is it able to pass the economic substance test?
M/HQ can support you in assessing the impact of the new legislation on your business – providing preliminary assessments of your company’s current compliance obligations, and where required, help you to define a strategy and implement a bespoke plan of action.
Ensuring that your company complies with its administrative and statutory responsibilities can be cumbersome. Outsourcing this function to M/HQ enables you to comply with your obligations and to focus on what you do best – manage your operations and grow your business.
We are happy to discuss your company’s specific needs in depth in light of the new economic substance law, helping you find the most cost and time-effective solution to meet your administrative and statutory compliance responsibilities.
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