As detailed in our previous alerts, the UAE introduced the Economic Substance Regulations (the “ESR” or “Regulations”) by the enactment of Cabinet Decision No. 31/2019 on 30 April 2019 (See our fact sheet — UAE Economic Substance Law Briefing). A directive providing details on its implementation (See our fact sheet — UAE Economic Substance Regulation Update: Guidance Released) and concerned Regulatory Authorities (To read more, click here) were released further on.
Guidance with respect to the time, form and method of submission for the notifications and reports have been eagerly awaited. In a recent presentation, the DIFC provided some clarifications, verbally announcing 31 March 2020 as the deadline for the submission of the first notification period (effective from January 1) and confirming the authority of the RoC (“Registrar of Companies”) as the Regulatory Authority in the Free Zone to which notifications should be submitted to.
While more guidance is expected in the future, it is imperative that any affected Licensee starts assessing its existing situation, and makes sure that it is compliant with ESR in order to avoid penalties.
How can we help?
Understanding ESR is paramount to ensure 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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