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The Exchange of Tax Information Portal is an initiative of the Global Forum on Transparency and Exchange of Information for Tax Purposes. The Global Forum conducts peer reviews of its member jurisdictions' ability to co-operate with other tax administrations in accordance with the internationally agreed standard. The standard provides for exchange of information on request where it is foreseeably relevant to the administration and enforcement of the domestic tax laws of the requesting jurisdiction. Effective exchange of information requires that jurisdictions ensure information is available, that it can be obtained by the tax authorities and that there are mechanisms in place allowing for the exchange of that information. The Global Forum's peer review process examines both the legal and regulatory aspects of exchange (Phase 1 reviews) and the exchange of information in practice (Phase 2). The EOI Portal will track the development of these peer reviews, including changes that jurisdictions make in response to the Global Forum's recommendations.

Peer Review: Peer Review Report Phase 1 Legal and Regulatory Framework - United Arab Emirates

This report for United Arab Emirates has been published on 20 Jun 2012. You can buy this report, or browse it online below.

Skip directly to the Executive Summary. You may also want to view the tables of determinations and ratings.


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Determinations and Recommendations

Jurisdictions should ensure that ownership and identity information for all relevant entities and arrangements is available to their competent authorities. (ToR A.1)
Determination Factors Recommendations
The element is in place, but certain aspects of the legal implementation of the element need improvement.   Foreign companies having their main offices, main activities or effective management in the DIFC (other than those regulated by the DFSA) or other free zones are not consistently obliged to maintain ownership information or provide it to the authorities and thus such information may not be available to the competent authority.   The UAE should ensure that ownership information is available for foreign companies having their main offices, main activities or effective management in the DIFC or other free zones.  
The UAE law does not ensure the availability of information on the participating partners of partnerships limited with shares. Further, the information on all partners of foreign general partnerships and foreign limited partnerships that are registered as recognised partnerships in the DIFC is not available.  The UAE as well DIFC laws should ensure that information on the partners of partnerships limited with shares and foreign general partnerships and foreign limited partnerships is available to its competent authority. 
Identity information may not be consistently available in respect of foreign trusts which have an administrator or trustee in the UAE or in a free zone other than the DIFC.  An obligation should be established to maintain information in all cases in relation to settlors, trustees and beneficiaries of those foreign trusts which have an administrator or trustee in the UAE or in a free zone other than the DIFC. 
Not all free zones have effective enforcement provisions in place to ensure availability of ownership information.  The relevant authorities in all free zones should establish effective enforcement provisions to reinforce the availability of information on the ownership of relevant entities. 
Jurisdictions should ensure that reliable accounting records are kept for all relevant entities and arrangements. (ToR A.2)
Determination Factors Recommendations
The element is not in place.   Foreign companies in the DIFC, other than those regulated by the DFSA, and in other free zones are not obliged to keep accounting records consistent with the standard. Further, entities in the Fujairah Free Zone are not obliged to keep accounting records.  The UAE should ensure that complete and reliable accounting records consistent with the standard are required to be kept by all entities in the free zones, including foreign companies, for at least five years. 
Entities in the DIFC and the other free zones are not obliged to maintain underlying documentation for their accounting records. UAE and free zones legislation (with the exception of the DIFC) do not ensure that reliable accounting records or underlying documentation are kept for foreign trusts with a resident administrator or trustee.   The UAE should oblige all entities in the free zones to maintain full underlying documentation in line with the international standard for at least five years. The UAE and free zones laws should expressly provide for keeping of complete accounting records, including underlying documentation, for at least five years for foreign trusts with resident administrators or trustees.  
General partnerships and limited partnerships in the DIFC, other than those regulated by the DFSA, and some entities in the other free zones are not obliged to retain their accounting records for at least five years.  The accounting record keeping requirements should ensure that all entities in the DIFC and other free zones maintain accounting records for a minimum five year period. 
UAE and free zones legislation (with the exception of the DIFC) do not ensure that reliable accounting records or underlying documentation are kept for foreign trusts with a resident administrator or trustee.  The UAE and free zones laws should expressly provide for keeping of complete accounting records, including underlying documentation, for at least five years for foreign trusts with resident administrators or trustees. 
Banking information should be available for all account-holders. (ToR A.3)
Determination Factors Recommendations
The element is in place.      
Competent authorities should have the power to obtain and provide information that is the subject of a request under an exchange of information arrangement from any person within their territorial jurisdiction who is in possession or control of such information (irrespective of any legal obligation on such person to maintain the secrecy of the information). (ToR B.1)
Determination Factors Recommendations
The element is not in place.   The ability of the Ministry of Finance to access foreseeably relevant information for exchange of information purposes, either directly or via other agencies, is unclear and there are no provisions in law providing authorities with the power to collect information on behalf of the Ministry of Finance for the purpose of responding to EOI requests.   The UAE should introduce express statutory provisions ensuring the authorities have access to information for exchange of information purposes. 
Confidentiality provisions in the Central Bank law and the DFSA laws are not explicitly overridden to access banking information for EOI purposes.   The UAE should ensure that the confidentiality provisions in the UAE laws are overridden to permit access to banking information for EOI purposes. 
The scope of legal professional privilege appears to extend beyond that provided for in the international standards.   The UAE should ensure the application of legal professional privilege does not limit or prevent it from responding to a request for information made pursuant to an international exchange of information request. 
The rights and safeguards (e.g. notification, appeal rights) that apply to persons in the requested jurisdiction should be compatible with effective exchange of information. (ToR B.2)
Determination Factors Recommendations
The element is in place.      
Exchange of information mechanisms should provide for effective exchange of information. (ToR C.1)
Determination Factors Recommendations
The element is not in place.   The UAE’s arrangements providing for international exchange of information have not been given effect to through domestic law as there are limitations in the authorities’ powers to obtain necessary information for the purpose of international information exchange.   It is recommended that the UAE ensure it has complete legislation enabling it to give full effect to its EOI agreements. 
11 out of the 60 DTCs signed by the UAE do not meet the international standard.   The UAE should work with relevant partners to ensure that these agreements are brought in line with the international standard. 
The jurisdictions' network of information exchange mechanisms should cover all relevant partners. (ToR C.2)
Determination Factors Recommendations
The element is in place, but certain aspects of the legal implementation of the element need improvement.   The UAE has a comprehensive network of EOI arrangements with relevant partners but the issues identified in respect of access powers need to be addressed.  The UAE should ensure it gives full effect to the terms of its EOI arrangements in order to allow for full exchange of information to the standard with all relevant partners. 
  The UAE should continue to develop its EOI network, regardless of its form, to the standard with all relevant partners. 
The jurisdictions' mechanisms for exchange of information should have adequate provisions to ensure the confidentiality of information received. (ToR C.3)
Determination Factors Recommendations
The element is in place.      
The exchange of information mechanisms should respect the rights and safeguards of taxpayers and third parties. (ToR C.4)
Determination Factors Recommendations
The element is in place.   DTCs with the Czech Republic, Indonesia, Morocco, Poland and Romania are not fully consistent with the international standard due to absence of safeguards providing for protection of trade or business secrets.  The UAE should work with relevant treaty partners to ensure that these agreements are brought in line with the international standard. 
The definition of information subject to legal professional privilege in the UAE’s DTCs follows that of its domestic law, which is wider than the scope accepted under the international standard.  The UAE should ensure that the scope of legal professional privilege in its EOI mechanisms is consistent with the international standard. 
The jurisdiction should provide information under its network of agreements in a timely manner. (ToR C.5)
Determination Factors Recommendations
The assessment team is not in a position to evaluate whether this element is in place, as it involves issues of practice that are dealt with in the Phase 2 review.