Companies and establishments that are involved in ‘relevant activities’ in the UAE are required to submit economic substance notifications and reports to the regulatory authority
Companies and establishments that are involved in ‘relevant activities’ in the UAE are required to submit economic substance notifications and reports to the regulatory authority on an annual basis, in accordance with the provisions of the Cabinet Resolution, which stipulates the submission of these notifications and reports. Failure to adhere to this will result in sanctions.
The Economic Substance Regulations (ESR) in the United Arab Emirates (UAE) have introduced a framework to ensure that companies and establishments engaged in certain "relevant activities" meet the economic substance requirements. Compliance with ESR is essential to avoid sanctions and penalties. At Tulpar, we offer ESR Advisory Services to assist businesses in understanding, implementing, and complying with these regulations.
Understanding ESR in the UAE:
The ESR framework in the UAE requires companies and establishments involved in specific "relevant activities" to submit annual economic substance notifications and reports to the regulatory authority. Failure to comply with these regulations can result in sanctions.
List of Relevant Activities under ESR:
- The relevant activities subject to ESR in the UAE include:
- Banking Business: Entities engaged in banking activities within the UAE.
- Insurance Business: Companies involved in insurance-related activities.
- Investment Fund Management Business: Entities engaged in the management of investment funds.
- Lease–Finance Business: Businesses involved in lease-finance activities.
- Headquarters Business: Companies acting as regional or international headquarters.
- Shipping Business: Entities engaged in shipping activities.
- Holding Company Business: Companies that primarily hold and manage equity investments.
- Intellectual Property Business ("IP"): Entities that hold, license, or develop intellectual property.
- Distribution and Service Center Business: Businesses acting as distribution and service centers for goods and services.
Our ESR Advisory Services:
At Tulpar, we provide comprehensive ESR Advisory Services tailored to your business's specific needs:
- ESR Compliance Assessment: We assess your business activities to determine whether they fall within the scope of relevant activities and ESR requirements.
- ESR Strategy Development: We assist in the development of a customized ESR compliance strategy, ensuring that your business meets the regulatory requirements.
- Implementation Support: We help you implement necessary changes and measures to ensure compliance with ESR.
- Annual Reporting: We guide you through the process of preparing and submitting annual ESR notifications and reports to the regulatory authority.
- Risk Mitigation: We identify potential risks related to ESR compliance and develop strategies to mitigate them effectively.