The UAE has implemented stringent regulations to prevent and control crimes related to money laundering and financing of terrorism (ML/FT). Declaring the Ultimate Beneficial Owner (UBO) to the relevant licensing authority is a mandatory requirement in the UAE in line with the regulations governing Anti-Money Laundering and Combatting the Financing of Terrorism (AML-CFT).
An UBO is defined as an individual who ultimately owns or controls the entity, or any other indirect means.
The UBO can also be an individual on whose behalf the transactions are being conducted or who exercises ultimate control over a legal person.
Businesses need to identify and submit the details of the UBO as prescribed by the licensing authority to avoid hefty fines and other serious consequences. UBO service providers in Dubai can help you submit the UBO details to the authority.
Let us dive in to know more:
Mandatory UBO Information to be Submitted
Companies operating in the UAE need to submit the Statement of Identification of the Beneficial Owner Data to the licensing authority. The statement must contain the following information:
- Full name as per the identity card or passport (Attach a true copy of valid identity card or passport
- Nationality, Date and Place of Birth
- Country of issuance, date issuance and expiry date of the identity card or passport
- Residential address or the address which the notices shall be sent on it
- Name of the entity and address thereof
- Identification of the Beneficial Owner capacity in the Legal Person who owns 25% or more, basis and date on which the person became a Beneficial Owner of the Legal Person.
- Disclosure of the number of other legal persons which the Beneficial Owner owns, manages or controls accordingly
Violations and Relevant UBO Penalties in the UAE
For all the UBO violations in the UAE, the licensing authority will issue a written warning and will impose a penalty if it is not rectified. UBO services providers in Dubai cab help you avoid the penalties by meeting the compliance requirements. The following are the penalties:
|
Serial No. |
Violation | First Time Penalty | Second Time Penalty | Third Time Penalty |
| 1. | Failure to create Beneficial Owner Register of and maintain its data | Written Warning | AED 50,000 and warning to rectify within 30 Days | AED 100,000 and trade license suspension for at least 12 months |
| 2. | Failure to include the data mentioned in Clause (2) of Article (8) of the Cabinet Resolution No. (58) of 2020. | Written Warning | AED 20,000 and warning to rectify within 15 Days | AED 40,000 and suspension of the trade license for at least 6 months |
| 3. | Failure to maintain adequate, accurate, specific and updated data of Beneficial Owner or Failure to correctly record down the Beneficial Ownership | Written Warning | AED 10,000 and warning to rectify within 15 Days | AED 20,000 and suspension of the trade license for at least one month |
| 4. | Failure to provide the Registrar with the data regarding the details of the director or nominal board member | Written Warning | AED 20,000 and warning to rectify within 15 days | AED 40,000 and restriction of the powers of the board members or directors, who are proved liable for the violation |
| 5. | Failure to create the Register of Partners or Shareholders. | Written Warning | AED 50,000 and warning to rectify within 60 Days | AED 100,000 and suspension of the trade license for at least 12 Months. |
| 6. | Failure to maintain the information of all partners or shareholders in the Register of Partners or Shareholders. | Written Warning | AED 30,000 and warning to rectify within 15 days | AED 60,000 and suspension of the trade license for at least 6 Months |
| 7. | Failure to submit the information of beneficial owner and the Register of Partners or Shareholders and maintain them from damage, loss or destruction.
|
Written Warning | AED 15,000 and warning to rectify within 15 Days | AED 30,000 and suspension of the trade license for 3 months |
| 8. | Failure to provide any additional information required by the Registrar
|
Written Warning | AED 5,000 and warning to rectify within 15 days | AED 10,000 and suspension of the trade license for at least one Month |
| 9. | Failure of the legal person to provide the Registrar with the name of a natural person residing in the UAE and authorized to disclose to the Registrar all data and information required by the mentioned Federal Decree-Law or Executive Regulations thereof.
|
Written Warning | AED 1,000 and warning the legal person to rectify its situation within Fifteen (15) Days as of the violation issue | AED 2,000 and suspension of the trade license for at least One (1) Month. |
| 10. | Legal person to issue shareholder’s share guarantees.
|
Written Warning | AED 5,000 | AED 10,000 |
| 11. | Failure of the legal person, on the issuance of shares or stocks in the name of persons or board members, to disclose to the Registrar the information in respect of such shares or stocks and the identity of such persons or board members within Fifteen (15) Days as of such issuance
|
Written Warning | AED 5,000 and warning the legal person to rectify its situation within Fifteen (15) Days as of the violation issue. | AED 10,000 and restriction of the powers of the board members, directors or owners, who are proved liable for the violation |
| 12.
13. |
Failure to hand over to the liquidator the Register of Beneficial Owner and Register of Partners or Shareholders within 30 Days as of appointing the said liquidator
Failure of the legal person or the liquidator to maintain the records and all information referred to herein for at least Five (5) Years as of the date of dissolution, liquidation or deregistration
|
Written Warning
Written Warning |
AED 5,000 and warning to rectify within 15 days
AED 20,000 |
AED 10,000 and suspension of the trade license for at least One (1) Month
AED 40,000 |
JBC Can Save you from UBO Penalties in Dubai
As the UAE is stringently enforcing AML-related compliance requirements such as the UBO, companies should tread the waters carefully. Non-compliance may lead to hefty penalties, suspension of trade license and reputation damage. An efficient way to navigate the complex system of Uno compliance is to seek the advice of the best UBO consultants in Dubai such as Jitendra Business Consultants (JBC). We are one of the leading providers of UBO services in Dubai with a reputation for saving our clients from hefty penalties.
JBC has a team of UBO advisers in Dubai who have in-depth knowledge about the UBO compliance landscape. Our consultants can advise the companies on the creation of UBO registers, record-keeping, and maintenance of UBO registers. If any penalty is incurred, JBC can appeal on behalf of the clients. Business owners who are confused about UBO compliance requirements can consult with our UBO advisors in Dubai.
