Notification & Reporting Timeline & Guidance
In continuation of Economic Substance Reporting in UAE regulatory updates, in this edition, the key highlights are announcements of various regulatory authorities in UAE on Economic Substance notification and filing. BensCA will keep you updated from time to time as and when the updates will be released from relevant authorities. This alert document also covers the latest updates from Dubai Multicommodity Centre, DAFZA, and DDA.
Summary of due dates and guidance
| Relevant Authority | Due Dates with updated comments | Further Guidelines |
| Dubai Development Authority (DDA) | Not published yet. | DDA updated in email note that there is no official announcement regarding the Economic Substance Regulations from our management yet. Once it is ready, a circular will be sent to all our business partners with full details regarding this matter. |
| Dubai Silicon Oasis (DSO) | 20th March 2020, it is no longer applicable, new date to be announced. | DSO already shared a summary of ESR guidelines with its licensees. |
| DMCC | June 30th, 2020. | Refer (to) the details (ed) guidance published by DMCC here. Refer further note in annexure below. |
| Dubai International Financial Centre (DIFC) | The last communicated due date was March 3, 2020, which no longer applicable, net date to be announced. | DIFC details guidelines are available here for further reference. |
| Abu Dhabi Global Markets (ADGM) | The previous date was March 31st, 2020, which is not applicable now, new date to be announced. | ADGM Licensees has to file the notification via their website, for further guidance refer www.registration.adgm.com. |
| DAFZA | May 3rd, 2020. | Refer to the Annex at the end of this Alert. |
| Ajman Free Zone | June 30th, 2020. | Ajman Free Zone already shared details guidance to its licensees. |
| UAQ Free Trade Zone | Refer the guidelines provided on their website | https://uaqftz.com/blog/2020/02/13/economic-substance-rules-how-do-they-affect-uae-business-owners/ |
| RAK Economic Zone | June 30th, 2020. | Further details are not published yet. |
| RAK ICC | June 30th, 2020 | RAK ICC shared the template and other filing step by step details, refer annex below. |
Annexure
DAFZA Guidelines
DAFZA has informed its licenses, and their branches to must submit economic substance notification by May 3rd, 2020 (irrespective of whether they conduct a Relevant Activity). They also mentioned in the same circular a step-by-step guide on how to submit their economic substance notification. Follow the key points are also worth to note:
o It is the duty and liability of the licensee to determine/assess whether they are conducting a relevant activity or not; DAFZA will not provide any indication or assessment. Licensees will have to take appropriate actions to evaluate and file the notification.
o DAFZA advised its licensees to file the notification via their porta by the Services tab and complete the ESR notification form in the Licensing Services section. You need a login ID and password.
o The ESR notification will include details of:
Ø The licensee’s financial year-end.
Ø If any income revenued by the Relevant Activity is partially or completely subject to the taxation outside of the UAE
Ø Whether or not get the exemption in Licensee owing to Government ownership
Ø Whether or not the licensee undertakes a Relevant Activity.
o If a company under DAFZA identified itself involved in one of the relevant activities, they must file the notification within 12 months from the end of the financial year. DAFZA will also inform via a notification on the availability of the relevant form on their portal.
o All relevant records must be kept in the state and provided in English when & if required.
DMCC Notification due date announced
DMCC member must provide an annual declaration of whether they have conducted any Relevant Activities in the preceding financial year, latest by 30 June 2020. DMCC will inform you of the availability of the relevant form and guidance on its portal soon; we advise you to keep checking with you in April/May 2020.
RAK International Corporate Centre (RAK ICC)
RAK has released step by step guidance on the submission of ESR notification; the due date is June 30th, 2020. Following key points are important to note:
o ALL licensees (irrespective of whether they undertake a relevant activity or not) would need to submit their notification through the Registered Agent Portal by 30 June 2020.
o The notification form will be available on the Registered Agent Portal from 29 March 2020.
o RAK ICC is facilitating the agents holding several licensees to make the bulk filing. Contact RAK ICC at esr@rakicc.com.
o Penalty for filing ESR as required will fetch administrative penalties AED 10,000 to AED 300,000, exchange of information with the relevant Foreign Authority and potential suspension, revocation, or non-renewal of registration.
o Following details are required in the notification on the portal:
Ø Company name & Financial year-end.
Ø Reportable period & Type of Relevant Activity involved
Ø Earned income, if any, from the Relevant Activity for the reporting period
Ø Whether such income is subject to tax outside the UAE
Ø Mention if the share capital of 51% directly or indirectly owned by the UAE Govt. bodies
Ø If the entity was a tax resident outside the UAE
Ø If any entity is categorized as a High-Risk Intellectual Property business as mentioned in ESR law, the agent must provide additional details like a parent company, ultimate parent company, and ultimate beneficial owner (name and country) in the notification.
Other Regulatory Authorities
We will keep updating you with the latest information as and when the other authorities and MOFA publish further information, guidelines or deadline notification, etc.
Other Information
You can refer to the relevant authority for further information or guidelines, also read the articles published by various consultants and newspapers.
Contact us
Our experts are available to support the businesses to Assess whether your business is carrying a relevant activity, support in compliance, and maintenance of specific protocol to stay compliance and help to file the notification. Get in touch.
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