Services
ESR Filling Service
The Economic Substance Regulations (ESR) in the UAE are an essential compliance requirement for entities operating within the country. Initially, the UAE Ministry introduced Cabinet Resolution No. 31/2019, effective from 30th April 2019, to implement ESR in the UAE. This was further supported by Ministerial Decision No. 215 of 2019, which provided detailed guidelines for enforcing the provisions of Cabinet Resolution No. 31/2019. However, on 10th August 2020, a new ESR framework was introduced via Cabinet Resolution No. 57/2020, which repealed the earlier Resolution No. 31/2019. Ministerial Decision No. 100 of 2020 also replaced Ministerial Decision No. 215 of 2019.
What are the Relevant Activities under the UAE Economic Substance Regulations?
All UAE-based entities, including those in the mainland, free zones, offshore jurisdictions, and financial free zones, fall under the scope of the ESR if they earn income from any of the following relevant activities:
- Banking Businesses
- Insurance Businesses
- Investment Fund Management Businesses
- Lease-Finance Businesses
- Headquarters Businesses
- Shipping Businesses
- Holding Company Businesses
- Intellectual Property Businesses
- Distribution and Service Centre Businesses
Annual ESR Notification Requirements
Both Licensees and Exempted Licensees must file an ESR Notification annually, providing the required information.
Exempted Licensees must also submit all relevant documentation to support their claim of exemption status.
The ESR Notification must be filed within six months from the end of the financial year. Additionally, the ESR Report must be submitted within twelve months from the end of the financial year for both Licensees and Exempted Licensees.
Penalty for Late Filing of Economic Substance Notification
Mainland, free zone, and offshore companies must file their Economic Substance Notification by the deadline. Failure to do so will result in fines ranging from AED 10,000 to AED 50,000. Providing false information in the notification will incur similar penalties. To avoid these fines, businesses should seek professional ESR services in Dubai.
How Kloudac Experts Can Help
Our experts will assess your business to determine if Economic Substance Regulations apply, ensuring timely and accurate compliance.
Setup
If Economic Substance Regulations apply to your company, we assist you in assessing whether you meet the required Economic Substance standards.
Consultancy
If gaps are identified, we pinpoint them and offer recommendations to ensure full compliance with UAE Economic Substance Regulations.
Documentation Support
We help Licensees prepare and submit the necessary Information Notifications to the relevant authorities.
Get in Touch!
Have questions or need support?
Reach out to the KLOUDAC team, we’re here to help you every step of the way.
