UBO in the UAE (2024-2025): understanding and applying Decisions 1092023 and 1322023

Ultimate Beneficial Ownership (UBO) transparency is a UAE priority. Based on the source “Understanding the Ultimate Beneficial Owner in UAE Businesses: Insights from Cabinet Decisions No. 109/2023 and No. 132/2023” (Al Rowaad Advocates, Apr 2024), this guide explains who the UBO is, how to identify and register them, and how to maintain records and manage penalties.

Purpose and scope

Decision 109/2023 sets the Real Beneficiary Procedures for UAE licensed entities (mainland and certain non financial free zones). It mandates disclosure and updates to the Registrar to combat money laundering, concealment and opaque ownership.

Defining the UBO

The UBO is the natural person who ultimately owns or controls the entity :

• Ownership/control ≥ 25% (direct/indirect; voting rights; chains of ownership);
• Control by other means (appoint/remove directors; strategic veto rights);
• Failing that, the senior management officer as fallback.

The Registrar looks at complex structures (SPVs, trusts, foundations, nominees). Multiple individuals can be UBOs where control is shared.

Registers and information

• UBO Register: identity, nationality, residency, nature/extent of interest, acquisition/loss dates.
• Register of Partners/Shareholders: natural/legal persons across the chain.
• Updates: file changes within statutory deadlines (internally, use a 15‑working‑day SLA as good practice).

Practical steps

1. Map the structure (full ownership chart, voting agreements, shareholder pacts).
2. Identify UBOs ≥ 25%; if uncertain, analyse de facto control (vetoes, appointments, budget).
3. Collect documents (ID, residency proof, extracts, attestations); arrange translations/legalisation where required.
4. Create the registers and file to the Registrar; retain timestamps and receipts.
5. Monitor for changes (M&A, share transfers, restructurings) and run a legal review before filings.

Penalties (Decision 132/2023)

Decision 132/2023 introduces administrative fines (published ranges) and licence suspensions for non filing, inaccurate filing, missing registers or failure to provide information. Repeat violations escalate penalties. The Registrar may issue warnings with remediation timelines.

AML/CFT and contractual alignment

UBO information underpins AML/CFT (KYC, ongoing monitoring) and must be consistent with internal registers and contract documents (articles, pacts, service agreements). Where inconsistencies arise, re examine the control chain.

Common pitfalls

• Threshold myopia: focus on effective control, not just share percentages.
• Global chains: anticipate document procurement (registry extracts, certificates, apostilles) and lead times.
• Static registers: run an annual review with cross‑checks (banking, corporate secretarial).
• Static registers: run an annual review with cross‑checks (banking, corporate secretarial).

Compliance checklist

1. Ownership chart and de jure/de facto control analysis.
2. Complete UBO files + ID/proofs.
3. Up to date UBO/shareholder registers; filing audit trail.
4. Change procedure (SLA, owners, sign offs).
5. Alignment with AML/KYC, corporate secretarial and contracts.

The UAE UBO regime is demanding yet pragmatic. A disciplined approach, mapping, evidence, registers and procedures, reduces penalty risk and builds trust with banks, investors and authorities.

Our lawyers, who are experts in business law, are available to answer all your questions and provide advice. We offer face-to-face meetings or videoconferencing. You can make an appointment directly online at https://www.agn-avocats.fr/.

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