UAE toughens laws by going for 'real beneficiary' at 400,000+ licensed businesses

Dubai: UAE authorities are making good progress in finding out the ‘real beneficiary’ on the more than 400,000 companies registered in the country. This is a crucial element in making the UAE’s corporate compliance regime to be on par with the best international regimes.

Real beneficiary relates to those individuals/entities that benefit from owning a registered business, but whose identity has not been known. The UAE in a series of moves have cut down all such options available to the actual beneficiaries.

Pinning down real beneficiary
A ‘real beneficiary’ is defined as the person owning the company, or directly or indirectly controlling it by owning more than 25% of company’s ownership rights. And 25% or more of the authority to vote and appoint or discharge the majority of members of the board of directors.

Under the tougher regulations, companies are to mandatorily create a register spelling out the real beneficiary and also list all the required data in the licensing requirements. The move supports the UAE’s efforts in taking on money laundering and the financing of illegal organizations, thereby “enhancing the UAE’s position in the relevant global indicators”.

How it’s done

The plan has been divided into four phases, including holding awareness workshops and providing training to 40 local licensing entities in the area of providing real beneficiary data, as well as receiving undertaking from licensed companies to provide their data.

This includes the information of real beneficiary and listing real beneficiary data in the National Economic Register’s system to be connected to the systems of the Ministry of Economy and licensing authorities in each emirate.

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