Dubai: The crackdown is all set to happen – from July 8, UAE businesses that do not offer info on the ‘ultimate beneficiary owner’ of that enterprise are liable for heavy penalties.
In the first phase, written warnings are to be issued to establishments that violate Cabinet Resolution No. (58) of 2020 on the Regulation of Ultimate Beneficial Owner Procedures, starting from July 1. The UAE has taken a no-quarter given on details of actual ownership of all licensed businesses establishments in the country. Businesses were given an extensive roadmap to comply with the regulations.
In the second phase, the Ministry will impose administrative penalties on establishments that fail to adopt the necessary measures to correct their status during this period will start on July 8. In this phase, fines stipulated by Cabinet Resolution No.53 of 2021 will be imposed on non-compliant establishments.
The penalties begin with the issuance of a written warning and if the non-compliance by an establishment continues, including but not limited to, a fine of Dh100,000, as well as additional administrative penalties such as the suspension of the license for a year or restrictions on the powers of the board of directors.
Establishments can appeal against the punitive measures within the specified legal period of 30 days from the date of notification of the violation, in accordance with the decision.
Plan of action
- The detection of violations will be carried out through a desk inspection, which is the examination of an establishment’s records with the licensing authority to ascertain the extent of its commitment to providing the required ultimate beneficial owner data.
- If a violation is found during this examination, administrative penalties will be imposed, starting with the issuance of a written warning in the first stage.
- Apart from that, field inspections will also be conducted to detect violations, during which, visits will be conducted to the offices of the establishments within the framework of the inspection campaigns of the relevant authorities.
The ultimate beneficial owner procedures include:
- Creating a record of relevant data and maintaining it within the establishment
- Verifying the accuracy and validity of the data and updating it on an ongoing basis
- Submitting the real beneficiary owner data to the licensing authorities through the designated channels