United Arab Emirates

1. This report is the United Arab Emirates’ (UAE) first annual peer review report. Consistent with the agreed methodology this report covers: (i) the domestic legal and administrative framework, (ii) the exchange of information framework as well as (iii) the appropriate use of CbC reports. There is no filing obligation for a CbC report in UAE yet.

Summary of key findings

2. UAE does not yet have legislation in place for implementing the BEPS Action 13 minimum standard. It is however in the final stages of drafting legislation and expects this to be in force by the end of 2019.

3. It is recommended that UAE take steps to implement a domestic legal and administrative framework to impose and enforce CbC reporting requirements as soon as possible.

4. It is recommended that UAE take steps to put QCAAs in effect with jurisdictions of the Inclusive Framework which meet the confidentiality, consistency and appropriate use prerequisites and with which UAE has an international exchange of information agreement in effect that allows for the automatic exchange of tax information1.

5. It is recommended that UAE take steps to implement processes or written procedures to ensure that the exchange of information is conducted in a manner consistent with the terms of reference (OECD, 2017[2]) relating to the exchange of information framework ahead of the first exchanges of information.

6. It is however noted that UAE will not be exchanging CbC reports in 2019.

Part A: The domestic legal and administrative framework

7. UAE does not yet have legislation in place for implementing the BEPS Action 13 minimum standard. It is however in the final stages of drafting legislation and expects this to be in force by the end of 2019.

(a) Parent entity filing obligation

(b) Scope and timing of parent entity filing

(c) Limitation on local filing obligation

(d) Limitation on local filing in case of surrogate filing

(e) Effective implementation

8. UAE does not yet have its legal and administrative framework in place to implement CbC Reporting and thus does not implement CbC Reporting requirements for the 2017 fiscal year.

9. It is recommended that UAE take steps to implement a domestic legal and administrative framework to impose and enforce CbC reporting requirements as soon as possible.

Conclusion

10. In respect of paragraph 8 of the terms of reference, UAE does not yet have a complete domestic legal and administrative framework to impose and enforce CbC requirements on the Ultimate Parent Entity of an MNE Group that is resident for tax purposes in UAE. It is recommended that UAE take steps to implement a domestic legal and administrative framework to impose and enforce CbC reporting requirements as soon as possible.

Part B: The exchange of information framework

(a) Exchange of information framework

11. As of 31 May 2019, UAE has no bilateral relationships in place for the exchange of CbC reports. It is recommended that UAE take steps to have qualifying competent authority agreements in effect with jurisdictions of the Inclusive Framework that meet the confidentiality, consistency and appropriate use conditions and with which UAE has an international exchange of information agreement in effect that allows for the automatic exchange of tax information.

(b) Content of information exchanged

12. UAE does not have processes or written procedures in place that are intended to ensure that each of the mandatory fields of information required in the CbC reporting template are present in the information exchanged.

(c) Completeness of exchanges

13. UAE does not have processes or written procedures in place that are intended to ensure that CbC reports are exchanged with all tax jurisdictions listed in Table 1 of a CbC reporting template with which it should exchange information as per the relevant QCAAs.

(d) Timeliness of exchanges

14. UAE does not have processes or written procedures in place that are intended to ensure that the information to be exchanged is transmitted to the relevant jurisdictions in accordance with the timelines provided for in the relevant QCAAs.

(e) Temporary suspension of exchange or termination of QCAA

15. UAE does not have processes or written procedures in place that are intended to ensure that a temporary suspension of the exchange of information or termination of a relevant QCAA be carried out only as per the conditions set out in the QCAA.

(f) Consultation with other Competent Authority before determining systemic failure or significant non-compliance

16. UAE does not have processes or written procedures in place that are intended to ensure that the Competent Authority consults with the other Competent Authority prior to making a determination that there is or has been significant non-compliance with the terms of the relevant QCAA or that the other Competent Authority has caused a systemic failure.

(g) Format for information exchange

17. UAE has not confirmed the format that will be used for the international exchange of CbC reports.

(h) Method for transmission

18. UAE has not indicated that it uses the Common Transmission System, or any other mechanism, to exchange CbC reports

Conclusion

19. It is recommended that UAE take steps to put QCAAs in effect with jurisdictions of the Inclusive Framework which meet the confidentiality, consistency and appropriate use prerequisites and with which UAE has an international exchange of information agreement in effect that allows for the automatic exchange of tax information.

20. Further, it is recommended that UAE take steps to implement processes or written procedures to ensure that the exchange of information is conducted in a manner consistent with the terms of reference relating to the exchange of information framework ahead of its first exchanges of information. It is however noted that UAE will not be exchanging CbC reports in 2019.

Part C: Appropriate use

21. UAE is a non-reciprocal jurisdiction and, as such, will not receive CbC reports submitted to tax authorities in other jurisdictions, and will not apply local filing. It is therefore not necessary for this peer review evaluation to reach any conclusions with respect to appropriate use of the reports.

Conclusion

22. UAE is a non-reciprocal jurisdiction and, as such, will not receive CbC reports submitted to tax authorities in other jurisdictions, and will not apply local filing. It is therefore not necessary for this peer review evaluation to reach any conclusions with respect to UAE’s compliance with paragraphs 11(a), (b), (c) and (d) and paragraph 12(a) of the terms of reference on appropriate use.

Summary of recommendations on the implementation of Country-by-Country Reporting

Aspect of the implementation that should be improved		Recommendation for improvement
Part A	Domestic legal and administrative framework	It is recommended that UAE take steps to implement a domestic legal and administrative framework to impose and enforce CbC requirements as soon as possible.
Part B	Exchange of information framework	It is recommended that UAE take steps to put QCAAs in effect with jurisdictions of the Inclusive Framework which meet the confidentiality, consistency and appropriate use prerequisites. and with which UAE has an international exchange of information agreement in effect that allows for the automatic exchange of tax information
Part B	Exchange of information framework	It is recommended that UAE take steps to implement the necessary processes or written procedures to ensure that the exchange of information is conducted in a manner consistent with the terms of reference relating to the exchange of information framework.
Part C	Appropriate use	-

Note

← 1. The UAE has provided information that legislation to implement the BEPS Action 13 minimum standard was introduced in the Cabinet of Ministers Resolution Number 32 of 2019, concerning the Regulation of the Submission of Reports by Multinational Companies, which was issued and came into force on 30 April 2019. This information was provided after work on the current peer review was completed, but will be taken into account in the next peer review of jurisdictions’ implementation of the BEPS Action 13 minimum standard, to be completed in 2020.

United Arab Emirates