The Economic Substance Report (ESR) is a regulatory framework implemented in Bahrain to ensure that businesses conducting certain activities have a substantial economic presence within the country. This framework aligns with international standards set by the OECD to prevent harmful tax practices and promote transparency.
Economic Substance Report (ESR)
Economic Substance Report (ESR)
Commercial organizations engaged in the following activities must submit an Economic Substance Return (ESR) annually in Bahrain to comply with regulatory requirements:
- Distribution and Service Center Activities:
- Headquarters Activities:
- Holding Company Activities:
- Leasing Activities:
- Shipping Activities:
- Intellectual Property Activities:
- Financial Data: Detailed records of your company’s financial transactions and statements.
- Business Activities Information: Comprehensive insights into the nature and scope of your business operations.
- Commercial Registration Information: Up-to-date details about your company’s Commercial Registration (CR) status and activities.
- Ultimate Beneficial Owners (UBOs) Information: Accurate identification and documentation of individuals who own or control the business.
The Ministry of Industry, Commerce, and Tourism (MOICT) issued Resolution No. (106) of 2018, outlining the requirements for validating the actual economic substance of entities’ activities in Bahrain. This resolution prescribes the rules that entities must meet to establish and maintain economic substance within the Kingdom of Bahrain.
Compliance with these rules ensures that businesses align with Bahrain’s regulatory framework, promoting transparency and adherence to international standards. For expert guidance on meeting economic substance requirements, consult Vizera Consultancy today!
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