What is the 25% beneficial ownership threshold under UAE law?
Under UAE law, the real beneficiary of a legal person is generally the natural person who owns or ultimately controls 25 per cent or more of the company. This can be through direct or indirect ownership of shares or capital, or through holding 25 per cent or more of the voting rights, including control exercised by other means such as the right to appoint or remove a majority of the board of directors.
The threshold is a starting point, not a ceiling. If more than one person holds a qualifying stake, each is treated as an owner and controller. If no one meets the test, or there is suspicion, the law requires identifying whoever controls the entity through other means, and if that fails, the senior managing official is treated as the beneficial owner. TCSPs and other DNFBPs must trace ownership through layered structures rather than stopping at the first company in the chain.
Legal Reference (UAE):
ยท Cabinet Resolution No. 109 of 2023 (Real Beneficiary Procedures), Article 5 - defines the 25 per cent ownership and control threshold and the fallback tests.
For more details, consult the full text of Cabinet Resolution No. 109 of 2023 or seek guidance from your AML compliance officer.