There have been changes made by the UAE government related to an Ultimate Beneficiary Officer (UBO). The government fairly recently released a notification which was titled Cabinet Decision No 58 in the August of 2020. This resolution stated that all the businesses which have been registered in the UAE must declare their Ultimate Beneficiary Owner (UBO). The businesses which were legal entities that were licenced in the various free zones and are owned by the federal government are an exception to this resolution.
The concept of an Ultimate Beneficiary Owner can be confusing to many businesses. In the article below we have tried to provide the meaning of an Ultimate Beneficial Owner (UBO) and have also explained how you can identify a UBO.
Meaning of a UBO
A UBO can be anyone who has ownership of a part of the business. This can be in the form of shares of any other form. A UBO can be understood as an entity that owns and controls at least 25 per cent of the total assets of the company.
According to the law passed by the UAE Government, the companies which are registered in the UAE need to maintain a register that will comprise all the information the UBOs, Nominees and shareholders of the company. This register needs to be submitted by the company to the Registrar within 60 days or 2 months of the date of the decision or under 60 days in which the company licence is issued.
Identification of a UBO
In order to identify a UBO, the company must perform certain steps. First of all, anyone who holds ownership or a portion of ownership in the company should be identified. When once this is done, the share of control should be measured among them. The entity with the maximum control should be considered as the Ultimate Beneficiary Owner (UBO) of the business.
Guidelines to Identify a UBO
The guidelines on identifying a UBO has been provided in Article 5 of resolution 58.
- Any entity who directly or indirectly owns a business via having ownership or through means of appointing or removing directors or has at least 25 per cent of the ownership of the business will be deemed as the UBO of the company.
- The Ultimate Beneficiary Owner can be identified and traced the legal persons as and when required.
- If there is more than one owner of the company or more than one person controls the maximum number of shares of a company, then in this case all these owners will be considered as the owners of the company.
- If after checking thoroughly no owner can be found of a company, then in this case the entity which is having the maximum ownership via other means will be considered as the owner of the company.
- If after all the work and thorough checks, no entity is found who meets all the above-mentioned conditions, then the person having the highest post in the company will be considered as an Ultimate Beneficiary Owner of the company.
This is how an Ultimate Beneficiary Owner of a company can be found out. We have tried to explain how a UBO can be found out of a company but the concept of an Ultimate Beneficiary Owner can be a little complex for many people. This is why it is recommended that the assistance of a reputed professional should be taken for such matter. This professional will understand the requirements of the business and will provide solutions accordingly.
If you are looking for such professionals in the United Arab Emirates, then you must have a look at the services provided by JAXA Chartered Accountants. JAXA Comprises a team of professionals which will help you to understand the concept of an Ultimate Beneficiary Owner and will also help in the proper planning of the business.
Jaxa also provides various other services for a business such as Accounting Services, Auditing Services, Tax and VAT related services and many more. These services will help your company to be more profitable in the long run. TO know more about the various services, feel free to Contact Us. We will be happy to help.