UAE telecom operators e& and Emirates Integrated Telecommunications Company (du) have paid AED3.54 billion in federal royalty to the UAE government during the first half (H1) the current year. This was lower compared to AED3.73 billion paid in the corresponding period of 2023.

 

According to the monitoring of the Emirates News Agency (WAM), based on the financial results announced by the two companies on the financial market websites, the aggregate amount of royalty payable by e& group in H1 reached AED2.75 billion compared with AED2.75 billion in H1 of 2023 while du paid AED797.6 million in H1 of 2024 compared with AED978.9 million for the same half last year.

 

From 2012 to 2023, the two telecom operators’ royalty payments stood at AED90.3 billion (AED70.6 billion by e& and AED19.7 billion by du).

 

Royalty Guidelines

The e& and du announced in November 2023 they received the Royalty Guidelines for the local telecom sector issued by the Ministry of Finance for January 2024 Through December 2026.

 

The 2024 royalty payment formula does not extend to what's generated from its international operations. The excluded items include:

*Profits generated from international controlled entities.

*Profits of international noncontrolled entities (associates and joint ventures).

*Dividends or other profit distributions received from international investments already subject to local corporate or other similar tax in the respective jurisdiction at 9% or above.

*Profit attributable to non-controlling interest holders of the UAE controlled entities.

 

The federal royalty rate of 38% will be applied to the sum of regulated and non-regulated UAE net profit for both e& and du, as well as the royalty and corporate tax rate of 9% on profit.

 

For e&, the aggregate annual amount of royalty and corporate tax shall not be lower than AED5.7 billion and for du it shall not be lower than AED1.8 billion per year.--TradeArabia News Service