The UAE followed the suit by issuing the UBO Regulations, which will mitigate the threat of financial fraud by having companies identify the individual that will ultimately benefit from the actions of such companies.
Under the UBO Regulations, as per the Cabinet Resolution No. 58/2020, all companies licensed and registered in the UAE – except those that are wholly owned by a local or federal government body, or those set up in the DIFC or ADGM financial free zones – are required to maintain registers with information about ultimate beneficial owners (UBOs), shareholders and any nominee board members.
The UAE Ministry of Economy has authorized licensing authorities across the country and in the non-financial free zones to begin implementing administrative penalties and fines against any companies that fail to submit ultimate beneficial ownership (UBO) information effective from 1 July 2021.
If no natural person satisfies these criteria, the UBO is the natural person who exercises control over the company by other means. If no natural person satisfies both the conditions above, then the UBO is deemed to be a natural person who is responsible for the senior management of the company.
The UBO Register must include the following for each UBO:
Full name, nationality, and date and place of birth
Place of residence or notice address
Passport or identification number, country, and date of issue and expiry
The basis on which the natural person is identified as a beneficiary
The date on which the person became a UBO, and if applicable, the date on which they ceased to be one.
In addition to this company shall also maintain Shareholder/Partner register containing all the details.
Article 17 states that administrative penalties will be imposed upon such Mainland Companies and Non-Financial Free Zone Companies that are in breach of the UBO Regulations or do not submit their UBO information to corporate regulators. The Ministry of Economy will be imposing fines of up to AED100,000 on those companies that fail to submit their UBO information by 30 June 2021.
There are separate set of regulations that apply to companies incorporated in financial free zones of Abu Dhabi Global Markets (ADGM) and Dubai International Financial Centre (DIFC).