20 July 2026 · Definition
Who Is an Ultimate Beneficial Owner
A UBO is the natural person who ultimately owns or controls a company: someone who owns or controls 25% or more of the shares or voting rights, directly or indirectly, or who otherwise exercises ultimate control over the company. Where no such person can be identified, a senior managing official is treated as the UBO. Tracing ownership through holding structures is essential to find the real person — a UBO is never a company, a trust, or any other legal person, only ever a natural individual. Indirect stakes are calculated by multiplying the ownership percentage at each layer of the structure, so a person can qualify as a UBO of a Dubai company without holding a single share in it directly, simply by controlling the holding company that does.
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How a UBO is identified
The 25% test looks past the company's share certificate to the person who actually stands to benefit or actually calls the shots. It applies to shareholding, to voting rights, and to control exercised by other means, so a shareholder sitting just under the threshold on paper can still be a UBO if they hold veto rights, appointment powers over the board, or another form of decisive influence. Both direct holdings and indirect holdings through parent companies, trusts or nominees count toward the 25% figure, and where several routes of control exist, whichever is highest generally governs the classification.
- Owns or controls 25% or more of the shares, held directly or through another entity.
- Or owns or controls 25% or more of the voting rights attached to those shares.
- Or otherwise exercises ultimate control — veto rights, board appointment powers, or a controlling agreement.
- Direct and indirect holdings are added together across every layer of the ownership chain.
- More than one person can qualify as a UBO of the same company at the same time.
When no one meets 25%
Some companies are held in evenly split stakes where nobody individually clears the 25% line — three partners at a third each, for example. In that scenario the law does not leave the company without a declared UBO; it falls back first to anyone exercising control through means other than shareholding, and only if nobody meets that test either does it move to the senior managing official, typically the general manager or an equivalent decision-maker named on the licence. Getting this cascade right matters, because naming the wrong person, or leaving the field blank, is treated the same as not filing at all.
- First check for anyone exercising control by other means, even without 25% of the shares.
- If nobody qualifies through shareholding or control, use the senior managing official.
- Trace through holding companies, trusts and nominee arrangements to the real individual behind each layer.
- Record the basis of control precisely — shareholding, voting rights, an agreement, or seniority.
- Revisit the fallback whenever the ownership structure or management changes.
Tracing ownership through a holding company
Say a Dubai LLC is owned 60% by a foreign holding company and 40% directly by an individual. The individual is a UBO in their own right at 40%. The holding company itself is owned equally by two people, so each of them holds an indirect 30% of the Dubai LLC — 50% of the 60% the holding company owns — which puts both of them over the 25% threshold too. The Dubai LLC ends up with three declared UBOs even though only one of them ever appears on its own share register, because the other two are reached by multiplying the percentages down through the ownership chain. The holding company itself never appears on the register: only natural persons qualify as UBOs, however many corporate layers sit between them and the operating company.
- Multiply the ownership percentage at each layer of the chain to find an indirect stake.
- An indirect stake above 25% creates a UBO obligation just like a direct one.
- A legal person — a company, trust or foundation — is never itself the UBO.
- Complex structures can produce more UBOs than the number of names on the local share register.
Mistakes that undermine the identification
The most common error is stopping the analysis at the first layer and naming a foreign holding company as the beneficial owner, when only the natural persons behind it qualify. The second is treating 25% as a hard line and ignoring control that falls just under it — a shareholder at 24% with a veto right or a casting vote is still a UBO through the control limb of the test, not the ownership limb. The third is doing the exercise once at incorporation and never revisiting it, even though a share transfer, a new investor, or a change in a shareholders' agreement can change who qualifies overnight.
- Naming a holding company, trust or foundation as UBO instead of the natural person behind it.
- Ignoring control rights — veto power, board appointment rights, casting votes — that create a UBO below 25% ownership.
- Treating the identification as a one-time exercise instead of revisiting it after every ownership or control change.
- Leaving the analysis undocumented, so the basis for each UBO's inclusion cannot be shown to the authority.
Related guides
Frequently Asked Questions
For identifying your real owners — the questions that come up most when tracing a company's ownership back to actual individuals.
Is a UBO always an individual?
Yes. A UBO is always a natural person, never a company, trust or other legal entity. Whatever the ownership structure looks like on paper, the exercise always ends with tracing it back to one or more real people.
What percentage makes someone a UBO?
Owning or controlling 25% or more of the shares or voting rights, or otherwise exercising ultimate control, such as through veto rights or the power to appoint the board. Either route on its own is enough to qualify.
What if no one owns 25%?
The test cascades: first to anyone exercising control by other means even without 25% ownership, and only if nobody meets that either, to the senior managing official, who is then recorded as the UBO in their place.
How do you calculate an indirect stake?
Multiply the ownership percentage at each layer of the structure. Someone who owns 50% of a holding company that owns 60% of the UAE entity holds an indirect 30% of that entity, and crosses the 25% threshold even without a single direct share.
Can a company or trust be a UBO?
No. Only natural persons can be UBOs. A holding company, trust or foundation is never the end point of the analysis — it is simply another layer to trace through until you reach the individuals who ultimately control it.
Does the UBO analysis need to be repeated?
Yes. Any share transfer, new investor, change of control or amendment to a shareholders' agreement can change who qualifies, so the identification should be revisited every time the ownership or control structure moves, not just once at setup.
Can Exiloz identify our UBOs?
Yes. We map your full ownership structure, including any offshore or multi-layer holding arrangements, calculate indirect stakes, and document the basis for each person's inclusion so it stands up if the licensing authority or a bank asks.
Identify your UBOs
Exiloz traces your ownership structure — however many holding companies or layers deep — to the natural persons who must be declared, and documents the basis for each one.