Economic Substance Regulation – ESR
The deadline for the submission of the first round of Economic Substance filings has expired on 30 June 2020. The Economic Substance Regulations implemented by the UAE in 2019 in accordance with the international standards of the OECD and the guidelines from the European Union require all UAE licensed entities who carry out any of the “Relevant Activities” to maintain an “adequate” “economic presence”.
Non-compliance with the regulations may lead to substantial fines and ultimately lead to deregistration of the company. More importantly, the UAE authorities must notify failed economic substance tests to the foreign authorities competent for the ultimate beneficial owner, the parent company and the ultimate parent, which may lead to the loss of eventual tax advantages. In this presentation, we guide you through the main issues and advice on the specific steps to be taken to protect your business.