Deadline to Submit 2022 Economic Substance Report

As per the Economic Substance Rules introduced by Resolution No. (106) of 2018 (and the supporting Guidance Notes published by the Ministry of Industry and Commerce (“MOIC”)) commercial entities in Bahrain which undertake a relevant activity are required to an Economic Substance Rules Annual Return Form (“ESR Annual Return”) to the MOIC on an annual basis.

The MOIC has now confirmed that the deadline for submission of the completed 2022 ESR Annual Return is between 13 August 2023 and 13 September 2023. Failure to submit the ESR Annual Return to the MOIC by the timeframe mentioned above may result in the imposition of violations against the Commercial Registration (CR) of a company.

If any of the below activities appear on your entity’s Commercial Registration (CR), then the entity is subject to ESR requirements and must submit the ESR Annual Return:

• Courier Services, logistics and transport of goods
• Activities of head offices or Management Offices
• Activities of holding companies
• Renting activities
• Intellectual property activities
• Water transportation activities and shipping agencies

What should you do next?

To avoid a violation(s) being placed on the Commercial Registration (CR), your Bahrain based entity must:

1. Determine whether it is subject to ESR;
2. Register your entity on the ITIES system and complete the ESR Annual Return;
3. Submit the ESR Annual Return to the MOIC via the ITIES system by the deadline specified above; and
4. Ensure that it is free of other violations and that it is renewed and active at the time of the submission of the ESR Annual Report.

How can we help?

As the leading law firm in the Middle East & North Africa Region and with strong corporate structuring experience across all industry sectors in the region, Al Tamimi & Company is well placed to assess the impact of the Rules on your organisation and assist you in complying with the Resolution, including working with you to determine whether your Commercial Registration (CR) is subject to ESR, complete and submit the required ESR Annual Return.

If you would like to further discuss the contents of this update, and find out what it means for your business, please contact Al Tamimi & Company in Bahrain.