ESR Services in DIFC

Globally, Economic Substance Regulations (ESR) combat tax avoidance and evasion. As an OECD member, the UAE adheres to global standards, reviewed by the OECD. The UAE's economic substance framework aims to regulate tax liabilities, applying to all licensed companies to curb evasion. This regulation addresses advantages from low-tax systems, impacting businesses onshore and offshore alike. ESR regulations extend to all UAE licensees, spanning mainland, free zones, and offshore entities, as well as individuals, involved in designated "Relevant Activities" (RA). These activities cover a broad spectrum, including banking, investment fund management, insurance, shipping, distribution and service center operations, lease financing, headquarters operations, holding company activities, and intellectual property management. Compliance with these regulations is obligatory, ensuring transparency and accountability across diverse sectors of the economy.