Ultimate Beneficial Owner (UBO)

The main objective of this was to regulate Ultimate Beneficial Ownership Procedures by making corporate affairs more transparent and reportable. If you are looking for UBO Services in Dubai, UAE then let us know!

Cabinet Resolution 58 was issued by the UAE government on 28 August 2020 and was brought in place of Cabinet resolution 34. The main objective of this was to regulate Ultimate Beneficial Ownership Procedures by making corporate affairs more transparent and reportable.

The legal arrangements are complex and detangling them is also cumbersome. Several factors hinder UBO verification, such as lack of clarity on multiple beneficial ownership outlines, non-co-operation, and other factors that make it difficult to carry out the process quickly and prevent compliance with the KYC process.

This regulation was brought into force in order to enhance corporate transparency. This resolution is applicable to all entities that are registered in the UAE mainland and free zones.

The ultimate beneficial owner (UBO) refers to the natural person(s) who ultimately owns or controls a legal entity or has the final ownership or control over its assets. The UBO is the individual who enjoys the economic benefits and risks associated with the ownership of the entity, even if the legal ownership is held in the name of another person or entity.

The definition of UBO can vary slightly from one jurisdiction to another, but generally, it refers to the person who meets one or more of the following criteria:

• Direct Ownership: Any individual who owns a significant percentage of shares or voting rights in a company, typically above a specified threshold (e.g., 25% ownership).
• Indirect Ownership: In cases where ownership is held through other legal entities, the UBO would be the natural person(s) who ultimately own or control those intermediary entities.
• Control through Other Means: Individuals who exercise significant control over the management or decision-making processes of a company, such as through dominant influence or contractual arrangements.

It's important to note that some jurisdictions may have specific regulations and disclosure requirements regarding the identification and verification of UBO’s. These regulations aim to enhance transparency, prevent financial crimes, and ensure compliance with regulatory frameworks related to AML, CFT, and corporate governance.

To determine the UBO of a legal entity, it is advisable to consult the relevant laws and regulations of the jurisdiction in question or seek professional advice from legal and financial experts familiar with the applicable rules.