- What is the purpose of the Notification?
The purpose of the Notification is to provide the Regulatory Authorities with certain initial information in respect of Licensees and their activities in the UAE for the relevant Reportable Period. The information provided as part of the Notification is a prerequisite to filing an Economic Substance Report for the same period (if required).
- Who needs to submit a Notification?
A Notification must be filed if you are a corporate entity (e.g. Limited Liability Company, Public Joint Stock Company, Private Joint Stock Company, etc.) or a partnership (Limited Liability Partnership, General Partnership etc.) that undertakes any of the following Relevant Activities in the UAE during the relevant Financial Year (see
Section C, Question 1):
- Banking Businesses
- Insurance Businesses
- Investment Fund Management Businesses
- Lease-Finance Businesses
- Headquarter Businesses
- Shipping Businesses
- Holding Company Businesses
- Intellectual Property Businesses
- Distribution and Service Centre Businesses
- What if the business only carried out a Relevant Activity for part of the year, is it still required to file a Notification?
Yes, the business must report all Relevant Activities undertaken during the Financial Year, irrespective of whether the Relevant Activity was conducted throughout the entire Financial Year.
- Can a single Notification be filed for multiple Licenses?
No, each Licensee must file a Notification on a stand-alone basis, irrespective of whether the Licensee is part of a consolidated group for accounting or VAT purposes.
- Does a branch file a separate Notification from its head office?
No, the UAE head office/parent company must file a single consolidated Notification that includes details of all its UAE branches that carry out a Relevant Activity, irrespective of whether the head office itself undertakes a Relevant Activity.
- What is the deadline for filing a Notification?
The Notification must be filed within six months from the Licensee’s financial year-end.
- How should the Notification be filed?
The Notification must be submitted electronically on the Ministry of Finance portal.
- What if the Licensee is in the process of being liquidated?
If the Licensee undertakes a Relevant Activity in the year of liquidation, the entity or its liquidators must ensure that all obligations under the Economic Substance Regulations are satisfied for the period up to liquidation, including the filing of a Notification and Economic Substance Report (where applicable).
- What happens if a licensee does not submit a Notification, although it is required to do so?
Non-compliance with the obligation to file a Notification before the deadline is subject to a penalty of AED 20,000.
- What happens if the information provided in the Notification is incorrect?
Providing incorrect or false information in the notification is subject to a penalty of AED 50,000. Knowingly providing incorrect or false information or incorrectly claiming an exemption from the Economic Substance Regulations can result in the Licensee being deemed to have failed the Economic Substance Test for the relevant Reportable Period.
- Completing the Notification
All fields in the Notification are mandatory unless specifically designated as “optional”. The Notification will automatically show the next question (and section) based on your responses. Therefore, the ordering of questions (and sections) may, in some cases, not be sequential