Board meetings and directed and managed test

The situation

Entities must show they are directed and managed in Bahrain as part of the ES tests.

The law

• Economic substance rules: Ministerial Order No. 106 of 2018 and CBB Directive OG/499/2018: Entities carrying on relevant activities must show core income generating activity and management in Bahrain and lodge an ES return

What it means for you

Hold enough board meetings in Bahrain, with a quorum physically present, and keep minutes there. Strategic decisions should be taken at those meetings. Remote only boards weaken the position.

What to do

1. Plan meetings in Bahrain.
2. Ensure a quorum attends.
3. Minute key decisions.
4. Keep records in Bahrain.

Related

• Official guidance on Bahrain ES
• Do Bahrain economic substance rules still apply
• Missed ES return blocks CR renewal
• Which activities trigger Bahrain ES
• Bahrain ES return deadline
• CBB licensees and economic substance