The UAE is one of the top business and investment destinations for global companies. The long stable governance, market opportunities with access to African markets, a business-friendly framework, and a robust legal system have enabled the UAE to attract global business behemoths. The Emirates of the UAE are home to many Freezones, which cater to individual business sectors. The diversity offered by the Freezones has resulted in UAE becoming a multi-sector business hub which includes shipping, manufacturing, trading, export & imports and, finance industry etc. All the industries are governed by the set of regulatory policies designed by the government.
What is Regulatory Compliance?
Regulatory compliance can be broadly defined as targets that companies aspire to achieve compliance with the pre-defined set of rules, regulations, laws and policies. All companies are required to adhere to regulatory compliance. The regulatory compliance requirements vary from sector to sector and differ from one country to another country.
Regulatory compliance is mandatory for companies operating in the UAE. Non-adhere to regulatory compliance can result in incurring unnecessary fines and lawsuits and, in some instances, end up closing the UAE’s business. Some of the regulations compliance requirements that companies in Freezones and Mainland are:
- Economic Substance Regulations for Freezones and onshore
- Country by country (CbCR) for MNCs operating in the UAE
- Ultimate Beneficial Ownership (UBO)
- Anti-Money Laundering (AML)
- VAT Compliance
How can Regulatory Compliance help businesses in the UAE?
Adherence to regulatory compliance can be a feather in the hat for the companies operating in the UAE. There are many internal and external advantages for companies complying with regulatory policies. Some of the advantages of regulatory compliance are:
- Companies will require to prepare and maintain a Due Diligence report that will state the nature and state of your business’s compliance. It will help the business to be audit-ready and help management to build trust with the shareholders.
- Regulatory compliance promotes a safe and happy workspace where such regulations promote workers safety, financial security, insurance and other benefits.
- Regulatory compliance helps the organization deal with Risk Management and mitigate any potential risks the company can encounter. Adherence to regulatory compliance can be built goodwill with the government and can lead to state co-operation in the long term. History of good records in regulatory compliance can ensure hassle-free transactions with the government bodies.
- Being compliant can keep away all the heavy fines, penalties and legal actions. The management of the company can be worry-free and focus on business development.
- Regulatory compliance can act as one of the company’s driving factors to attract investor interest due to good records and updated due diligence reports.
Companies, daily, face a lot of challenges while organizing their regulatory compliance protocols due to the increasing number of regulations that change on a timely basis and need operational transparency. The benefits offered by ensuring adherence to regulatory compliance is far more than flaunting them. It is highly advisable and healthy for the companies to adhere to the regulatory framework.