URGENT ACTION REQUIRED: Submit ESR notification by 30 September 2023

Greetings,

As you are aware, according to the UAE Ministry of Finance's Economic Substance Regulation Guidelines (“ESR Regulation”), the requirement to file an ESR Notification and ESR Report is solely on the Licensees that are engaged in any of the Relevant Activities listed in the ESR Regulation.

The upcoming ESR notification deadline is 30th September 2023 (for Financial Year ending 31st March 2023). Considering the upcoming Public Holidays, we request you to take action no later than Thursday 28th September, as our offices will be closed from 29th September – 1st October.

Failure to file ESR notification within the deadline will lead to an amount of administrative penalty of dirhams twenty thousand (AED 20,000) imposed on a Licensee or Exempted Licensee who fails to submit the Notification (and any relevant information or documentation) in accordance with the provisions of this Resolution.

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What should your business do?

• We recommend that all Licensees conduct an ESR assessment, regardless of whether they are engaged in Relevant Activities or not, and submit an ESR Notification on the MoF portal if applicable
• The Licensees who are not engaged in any Relevant Activity are not required to submit the ESR Notification and/ESR Report, they shall be held answerable to their respective Regulatory Authorities
• Licensees that are not engaged in any Relevant Activity(s) and have not filed any ESR filings for that reportable financial period may be asked to give evidence of the same to their respective Relevant Authorities

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How can MBG help?

To avoid any issues with the relevant authorities such as the Federal Tax Authority ("FTA"), the Ministry of Finance ("MOF"), and hefty penalties, we advise that all Licensees conduct an assessment and inform the Regulatory Authority about its position.