The Ultimate Beneficial Owner Register in the UAE: What Your Company Must Keep.

UAE companies have to answer a simple question on paper: who really owns and controls this business? The answer goes into a beneficial owner register that the company keeps and shares with its registrar. The rules are anti-money laundering rules, and the fines for getting them wrong are real.

The current rules are in Cabinet Resolution No. 109 of 2023 Regulating the Real Beneficiary Procedures. It replaced Cabinet Resolution No. 58 of 2020, took effect on 16 November 2023, and is listed as active on the UAE Legislation portal. The law calls the beneficial owner the "Real Beneficiary".

Who counts as a beneficial owner

A beneficial owner is always a natural person, never a company. Under Article 5, it is anyone who ultimately owns or controls the company through:

• 25% or more of the capital, held directly or indirectly;
• 25% or more of the voting rights; or
• control by other means, such as the right to appoint or remove the majority of the board.

The company must trace ownership through any number of companies or arrangements. Where several people jointly own or control a percentage, they are all treated as owners of it.

If no natural person meets the ownership test after all reasonable steps, or there is doubt, the beneficial owner is the person who controls the company by other means. If that still identifies nobody, the natural person holding the senior management position is treated as the beneficial owner.

A worked example

"Our LLC has three shareholders: Amir with 40%, Sara with 35%, and Holdco Limited with 25%. Holdco is wholly owned by Omar."

• Amir, 40%. Beneficial owner.
• Sara, 35%. Beneficial owner.
• Holdco, 25%. A company cannot be a beneficial owner, so you look through it. Omar owns 100% of Holdco and so indirectly holds 25% of the LLC. That meets the "25% or more" test, so Omar is a beneficial owner.

The register would list all three people. If a shareholder agreement also gave someone the right to appoint or remove the majority of the board, that person would be a beneficial owner too, whatever their shareholding.

What the register must hold

Article 8 requires each company to keep a beneficial owner register with, for each beneficial owner:

• full name, nationality, and date and place of birth;
• place of residence, or an address for notices;
• passport or ID number, the issuing country, and issue and expiry dates;
• the basis on which the person became a beneficial owner, and the date; and
• the date the person stopped being a beneficial owner.

The company must also keep a partners or shareholders register under Article 10. It records the number and class of shares held, voting rights, the date each person became a partner or shareholder, and identity details, including a valid copy of the ID or passport for individuals. Nominee arrangements must be recorded too. A nominee board member must tell the company of that status, and of any change or cessation, within 15 days.

Filing with the registrar

The "Registrar" is the competent authority that supervises the commercial register for the company. The company must:

• submit the beneficial owner register and partners register data to the registrar within 60 days of its licensing or registration;
• give the registrar the name of a natural person resident in the UAE who is authorised to disclose the company's data;
• provide any additional data the registrar requests within 14 days; and
• submit any change to the data within 15 days of the change.

Companies may not issue bearer shares. On dissolution or liquidation, the registers must be handed to the registrar within 30 days, and the liquidator must keep the records for at least five years.

Deadlines for updates

The key clock is 15 days:

• update the beneficial owner register within 15 days of being informed of a change;
• update the partners or shareholders register within 15 days of learning of a change; and
• report the change to the registrar within 15 days.

Where the company suspects someone is a beneficial owner but their details are not recorded, it must ask them. If 15 days pass without an answer, it sends a formal notice, and if there is still no reply within 15 days, it records the details it has.

Penalties

Cabinet Resolution No. 132 of 2023 sets the fines. For most breaches, the first violation leads to a written notice to comply, with the fines applying to repeat violations:

Violation	First time	Second time	Third time
Not creating and maintaining a beneficial owner register	Written notice	AED 50,000	AED 100,000
Not registering beneficial owner details correctly	Written notice	AED 20,000	AED 40,000
Not updating the beneficial owner register	Written notice	AED 15,000	AED 30,000
Not providing register data to the registrar	Written notice	AED 15,000	AED 30,000
Not providing additional data within 14 days	Written notice	AED 15,000	AED 30,000
Not updating the partners register within 15 days	Written notice	AED 15,000	AED 30,000

On a third violation, the registrar may also suspend the commercial licence and close the business until the fine is paid and the breach is corrected. The full table lists further violations, including a single AED 100,000 fine for a liquidator who does not keep the records for five years.

Exemptions

The resolution does not apply to:

• companies wholly owned by the federal or a local government, and companies wholly owned by them;
• financial free zones; and
• government partners, meaning a federal or local government that is a partner or shareholder in the company.

Companies owned by a company listed on a regulated market with adequate beneficial ownership disclosure rules, or majority-owned subsidiaries of such a listed company, are excused from the Article 6 duty to obtain and hold beneficial owner information.

How we help

We are not a registered agent and we do not make filings with registrars. What we do is keep your company records tidy, so that shareholder changes are visible in your accounts and supporting documents, and we point you to your registrar when a change needs reporting. Clean bookkeeping and a current shareholder file make that conversation much shorter.

Frequently asked questions

Which law sets the UBO rules in the UAE?

Cabinet Resolution No. 109 of 2023 Regulating the Real Beneficiary Procedures, which replaced Cabinet Resolution No. 58 of 2020 and took effect on 16 November 2023. The fines are in Cabinet Resolution No. 132 of 2023.

What if nobody owns 25% or more?

The company looks for the natural person who controls it by other means. If no one can be identified, the natural person holding the senior management position is treated as the beneficial owner.

How quickly must we report a change of beneficial owner?

The company must update its own register within 15 days of being informed of the change, and submit any change in the data to its registrar within 15 days of the change.

Do free zone companies have to keep a UBO register?

The resolution applies to legal persons licensed or registered in the UAE, and the penalties resolution expressly covers non-financial free zones. Financial free zones are excluded and follow their own rules.