UAE Economic Substance Regulations(ESR) Updated notification :
The UAE Economic Substance Regulations(ESR) Test requires a Licensee to demonstrate that: the Licensee and Relevant Activity are being directed and managed in the UAE; the relevant Core Income Generating Activities (“CIGAs”) are being conducted in the UAE; and. the Licensee has adequate employees, premises and expenditure in the UAE
| Who is required to file | How to file | When to file | Form released | |
| DIFC | All entities/ licensees, including those who do not undertake relevant activity | Via DIFC portal | By 30 June 2020 (extended from 12 June 2020) | Yes |
| ADGM | Only entities/ licensees that are carrying out relevant activity | Via email to economicsubstance@adgm.com | By 30 June 2020 | Yes |
| DAFZ | All entities/ licensees, including those who do not undertake relevant activity | Via DAFZ portal | By 31 May 2020 (extended from 3 May 2020) | Yes |
| DMCC | All entities/ licensees, including those who do not undertake relevant activity | Via DMCC portal | By 30 June 2020 | Yes |
| RAK ICC | All entities/ licensees, including those who do not undertake relevant activity | Via RAK ICC portal by a registered agent only (online form) | By 30 June 2020 | Yes |
| Securities and Commodities Authority (SCA) | SCA have contacted via email all Investment Management Firms, Management Company Firms regulated by SCA requesting submission of the notification form | Via e-mail to fms@sca.ae | By 30 June 2020 (extended from 31 March 2020) | Yes |
| AJMAN FZ | All entities/ licensees, including those who do not undertake relevant activity | Via email to info@afz.ae | By 30 June 2020 | Yes |
| RAKEZ | All entities/ licensees, including those who do not undertake relevant activity | Via RAK EZ portal (online form) | By 30 June 2020 | Yes |
| Dubai World Trade Centre | Only entities/ licensees that are carrying out relevant activity | Via email to info@dwtcauthority.com | By 30 June 2020 | Yes |
| Dubai Aviation City Corporation | All entities/ licensees, including those who do not undertake relevant activity | Via email to economic.substance@dacc.ae | By 7 June 2020 | Yes |
| Dubai Healthcare City (DHCC) | Only entities/ licensees that are carrying out relevant activity | Via DHCC portal (online form) | By 7 June 2020 (extended form 31 May 2020) | Yes |
| Ministry of Economy | Only entities/ licensees that are carrying out relevant activity | Online form | By 30 June 2020 | Yes |
| Hamriyah Free Zone Authority (HFZA) | Only entities/ licensees that are carrying out relevant activity | TBC | By 30 June 2020 | TBC |
| Sharjah Airport International Free Zone (SAIF) | Only entities/ licensees that are carrying out relevant activity | TBC by SAIF during week started 7 June 2020 | By 30 June 2020 | No, TBC by SAIF during week started 7 June 2020 |
| International Free Zone Authorities (IFZA) | Only entities/ licensees that are carrying out relevant activity | Online form | By 30 June 2020 | Yes |
| Dubai Silicon Oasis (DSO) | All entities/ licensees, including those who do not undertake relevant activity | Via email to lic_section@dso.ae | By 9 June 2020 (extended from 31 May 2020) | Yes |
| Dubai Development Authority (DDA) | Only entities/ licensees that are carrying out relevant activity | Via portal link here | By 25 June 2020 | Yes |
| Media Zone Authority | All entities/ licensees, including those who do not undertake relevant activity | Online form here | By 30 June 2020 | Yes |
In UAE Economic Substance Regulations(ESR) Updated notification filing requirements,the approach of the different authorities in relation to which entities should be filing the initial notification is currently inconsistent, and therefore it is important to monitor announcements/ clarifications that are made by the relevant Regulatory Authorities.
Immediate actions
To avoid non-compliance with these rules and potential penalties, as a first and immediate step all UAE entities (both companies and branches) should assess whether they fall under the UAE Economic Substance rules (in 2019) and which of the below compliance obligations they may have (if any):
- Notification filing
- Having sufficient substance in the UAE and how to demonstrate this
- Filing of an annual substance return
If the entity does fall under these rules and has to demonstrate sufficient substance in the UAE, it should also make an assessment as to whether it can satisfy the economic substance tests prescribed by the regulations.
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