Economic Substance Regulation
Economic Substance - Filing & notification
ESR regulations requires UAE mainland and free zone companies and certain business that fall within the relative activities to show and maintain required “economic presence” in the UAE for the business activities their license is issued. The purpose is to ensure all business report actual profits with the corresponding business activity.
Regulatory authorities for ESR
Ministry of Economy
Security and Commodities Authority
Abu Dhabi Global Market
Media Zone Authority Dhabi
Abu Dhabi Airports Free Zone
Abu Dhabi Ports
Dubai Airport Free Zone
Dubai Healthcare City Authority
Dubai International Financial Center
Dubai South / Dubai Aviation City
Jebel Ali Free Zone Authority/ DP World
Dubai World Trade Center
International Humanitarian City
Dubai Development Authority
Dubai Silicon Oasis
Dubai Maritime City
Dubai Multi Commodities Centre
Sharjah Airport International Free Zone Authority
Hamriyah Free Zone Authority
Sharjah Media City (Shams)
Sharjah Publishing City
Sharjah Research Technology and Innovation Park
Sharjah Healthcare City
Ajman Free Zone Authority
Ajman Media Free Zone Authority
RAK International Corporate Centre
Ras Al Khaimah Economic Zone
RAK Maritime City
UAQ Free Trade Zone
- Business conducts the necessary revenue generating activity and managed directly without external influence
- Appropriate number of qualified full-time employees with regards to the activity who are physically present in the company irrespective of their type of employment.
- Convincing amount of expenditure recorded for the company and physical assets.
- Businesses may outsource the revenue generating activity provided they are able to monitor, control and supervise the outsourced activity done by the outsourcing partner
- Board meeting are carried within the state, recorded and minutes written signed by the board directors attendign the meeting. All data should be kept within the state.
What information is needed?
Both ESR eligible and exempted business are required to notify the regulatory authority for the financial year with the following information
- The Relevant Activity
- Revenue generated
- The date of commencement and end of financial year
- Any other information or documents as may be requested by the Regulatory Authority.
- Operating expenses and aspect
- Location of place of business. If required details of property or equipment used.
- Number of full time employees with qualifications
- Income generating acitivty with regards to the relevant activity
- Financial statements
- A declaration whether it satisfies Economic Substance test. In case of intellectual property business, a declaration as to whether or not it is a high risk IP Licensee
For evaluation of your business whether eligible for ESR or exempt use the contact form to send a request. Our ESR consultant will get in touch with you.