UBO (Ultimate Beneficial Owner) Declaration- Fines on UBO violators
The UBO is the person who, directly or indirectly, owns and controls a company. In other words, an individual should be considered as a UBO, if they hold at least 25 percent shares or voting rights of the company, or have the power to dismiss and appoint a majority of a company’s directors.
The UAE’s Ministry of Economy has started a campaign to ensure that more than 500,000 non-financial businesses in the country submit data on their ultimate beneficiaries.
Declaring a company’s ultimate beneficiary is ‘‘one of the main requirements for completing disclosures and transparency requirements from enterprises and individuals within the anti-money laundering system in the country” said Safeya Al Safi, Director of the ministry’s anti-money laundering department.
‘‘Ultimate beneficial owner procedures are key elements in UAE’s approach to curb money laundering and financing of terrorism and illegal organisations and financing the spread of weapons of mass destruction’’ said Ahmed Al Hosani, director of the commercial registration and certificates of origin department.
The ministry intends to register 513,000 businesses licensed by 38 authorities in the campaign. Those that failed to disclose the required data will face penalties from July, said Ahmed Al Hosani.
Ministry of Economy to impose fines on UBO violators from July 2021
From July 1, 2021, penalties will be imposed for violating UBO compliances which includes Dh100,000 ($27,229) for recurrence and continued noncompliance, along with additional administrative penalties, including, among others, license suspension for one year, and restrictions on board of director’s authority.
How to comply?
In the following 3 steps, private sector entities can submit their UBO data to the relevant authorities:
- The entities should create a register of their ultimate beneficial owner and maintain it within their documents. So that, this register shall be exhibited upon the request of concerned entities and individuals. In this respect, licensing authorities have provided forms stating all the details and information to be listed in the UBO register and these forms are available in the official website of the concerned authorities.
The following data of the UBO must be entered in the register:
- Full name, place and date of birth, and nationality
- Residential address to which notices shall be sent
- ID card or passport number, issuing country, and the issue date and expiry date
- The date and the basis on which the individual became the company’s UBO
- Submission of an undertaking to create the registry and ensure the accuracy of its data to the licensing authorities to which each establishment is answerable to. This step gives an opportunity to the establishment for determining their ultimate beneficial owner and submit their data to the competent authorities.
- Entering the ultimate beneficial owner data in the systems of licensing authorities through dedicated web pages on their official websites. So that, every establishment should check the websites regularly and communicate to the licensing authorities in this regard as soon as possible, to avoid penalties
Reference: Gulfnews
