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) of the current year, compared to AED3.73 billion in the corresponding period of 2023.
According to the Emirates News Agency (WAM), based on financial results announced by the two companies, the aggregate royalty payment by e& group in H1 2024 reached AED2.75 billion, matching the amount from H1 2023. Du paid AED797.6 million in H1 2024, down from AED978.9 million in the same period last year.
From 2012 to 2023, the two telecom operators’ royalty payments totaled AED90.3 billion, with AED70.6 billion paid by e& and AED19.7 billion by du.
In November 2023, e& and du announced they had 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 excludes profits generated from international operations, including:
- Profits from international controlled entities.
- Profits from international non-controlled entities (associates and joint ventures).
- Dividends or other profit distributions from international investments already subject to local corporate or similar tax at 9% or above.
- Profit attributable to non-controlling interest holders of UAE controlled entities.
The federal royalty rate of 38% will be applied to the sum of regulated and non-regulated UAE net profits for both e& and du, along with a 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.
