Economic Substance Regulations
Navigating the Economic Substance Regulations (ESR) can seem daunting, but we’re here to make it simple for you. Think of us as your friendly guide through this process.
What Are Economic Substance Regulations (ESR)?
The ESR are rules set by the UAE government to ensure that companies engaging in certain activities have a real presence in the UAE. This means having actual offices, employees, and business operations here, not just a company name on paper.
Why Were ESR Introduced?
The UAE introduced these regulations to meet international standards and avoid being listed as a tax haven. It’s a way to show that businesses here are genuine and contributing to the economy.
Who Needs to Comply with ESR?
If your company is involved in any of the following activities, you need to comply with ESR:
- Banking
- Insurance
- Investment Fund Management
- Lease-Finance
- Headquarters
- Shipping
- Holding Company
- Intellectual Property (IP)
- Distribution and Service Centre
If you’re unsure whether your business falls into one of these categories, we can help you figure that out.
What Do You Need to Do to Comply?
To comply with ESR, your business must:
- Conduct Core Income-Generating Activities (CIGAs): This means performing key business activities in the UAE.
- Have Adequate Staff and Premises: You need to have enough employees and physical office space in the UAE.
- Incur Adequate Operating Expenditure: Your spending in the UAE should reflect your business activities.
Reporting Requirements
Each year, you’ll need to submit an ESR notification and, if applicable, an ESR report to the relevant authorities. This demonstrates that you’re meeting the ESR criteria.
Penalties for Non-Compliance
Not complying with ESR can lead to penalties, including fines and even the risk of your business license being revoked. It’s important to stay on top of these regulations to avoid any issues.
How Can We Help?
At Beyond View, we’re here to make this process as smooth as possible for you. Our services include:
- Initial Assessment: We’ll review your business activities to determine if you need to comply with ESR.
- Compliance Assistance: We’ll help you meet all the ESR requirements, from setting up operations to ensuring proper documentation.
- Reporting: We’ll handle the submission of your ESR notification and report, ensuring everything is accurate and timely.
We take care of the details so you can focus on running your business. Reach out to us today, and let’s ensure your business is fully compliant with the Economic Substance Regulations.