United Arab Emirates – New treaties, update on exchange of information

United Arab Emirates – New treaties, update

Recent tax developments in the United Arab Emirates (UAE) include newly signed and/or ratified tax treaties and discussions held by the Ministry of Finance concerning the next stage of development of international requirements for tax transparency and the exchange of information.

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UAE gears up to meet international tax transparency standards

On 15 September 2014, officials with the Ministry of Finance met in Dubai with officials from other federal ministries and local institutions to discuss the progress of the UAE’s implementation of new international standards for fiscal transparency. The purpose was to discuss new developments in the international standards for transparency and exchange of information and to prepare for the Phase Two assessment by the Global Forum on Transparency and Exchange of Information for Tax Purposes (the “Global Forum”), part of the Organisation for Economic Co-operation and Development (OECD).

The Global Forum was created in the early 2000s in the context of the OECD’s work to address tax havens and the risks they pose to tax compliance. The Global Forum, which now has 122 members on equal footing, is charged with in-depth monitoring and peer review of the implementation of the standards of transparency and exchange of information for tax purposes.

Reviews of Global Forum members are undertaken in two phases:

  • In Phase 1, the quality of a jurisdiction’s legal and regulatory framework for the exchange of information is assessed.
  • In Phase 2, the practical implementation of that framework is reviewed.

At the request of the G-20 and the OECD, the UAE Ministerial Council for Services issued a decree in 2010 to include UAE as a member of the Global Forum.

The government’s approved text1 authorizes the Ministry of Finance to collect and exchange information and data on natural persons and legal entities licensed to operate in the UAE, including free zones due to a memorandum of understanding (MOU) between the UAE Free Zones and the Central Bank.

The Global Forum Phase 1 review report on the UAE, published in 2012, highlighted the amendments to the UAE’s legislation required to allow an effective exchange of tax information.

A supplementary report published in April 2014 assessed the new developments in the legal and regulatory framework of the UAE since the 2012 Phase 1 report. Improvements were recognized in the availability of ownership and accounting information in all free zones. In addition, an obligation was introduced for all relevant authorities to obtain information for exchange of information purposes on request.

In light of this progress, the Global Forum agreed to advance the UAE to its Phase 2 review, which is scheduled for the first half of 2015. In preparation, the Ministry of Finance and other participants highlighted the economic importance of tax information exchange – locally and globally. Mr. Khalid Ali Al Bustani, Assistant Undersecretary of International Financial Relations Sector at the Ministry of Finance, said:

The UAE’s commitment to meet the requirements for the exchange of information for tax purposes, is based on the country’s belief in liaising with international partners, to enhance transparency and in turn restore confidence in the global economy and reform the international financial system. This is reflected through the UAE’s position as a regional hub for the exchange of information for tax purposes in the [Middle East and North Africa] region for 2007 to 2015, as part of an agreement signed with the OECD2.

Mr. Bustani also stressed the Ministry of Finance’s commitment in working with the UAE authorities to enhance its position for the Phase 2 Review.

The Ministry of Finance has previously signed an MOU with the Secretariat of the Global Forum on the Transparency and Exchange of Information, which led to the UAE becoming the first Arab country to win a seat on the International Steering Committee. The Ministry of Finance has also signed five MOUs on transparency and information exchange with the UAE Central Bank, the Dubai International Financial Center, the Jebel Ali Free Zone, the Fujairah Free Zone Authority, and the Dubai Multi Commodities Centre.

Seven tax treaties signed and ratified

The UAE recently signed and/or ratified tax treaties with a number of territories:

  • The UAE signed and ratified tax treaties with Benin, Brunei, Hungary, Japan, Libya and Slovenia and a tax treaty protocol with Poland.
  • A treaty with Barbados has also been singed, but the ratification procedures are still pending from both countries.
  • The UAE’s treaty with Hungary recently entered into force.
  • The Albanian parliament ratified Albania’s treaty with UAE, and ratification by the UAE is pending.


1Cabinet’s decision No.12 was issued in 2010 and amended in 2012.

2UAE Ministry of Finance, press release, “MoF discusses updates on the international requirements for transparency and the exchange of information to prepare for the second phase of the Global Forum’s assessment”, 15 September 2014.

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