The ADGM foundation
Developed under the laws of Abu Dhabi Global Market, the foundation regime reflects international best practice while remaining anchored in the UAE. It is now widely used by local and international families, entrepreneurs and high net worth individuals with assets held across multiple jurisdictions.
An ADGM foundation is neither a company nor a trust. It draws features from both as a separate legal personality. That balance is intentional.
Understanding the ADGM foundation structure
A foundation is a separate legal entity with its own legal personality. It can own assets, enter into contracts and continue indefinitely. Unlike a company, it does not have shareholders. Instead, it is established for a defined purpose, usually connected to wealth management, succession or asset consolidation.
Assets are transferred into the foundation and held in its name. Control is exercised by the council, which manages the foundation in accordance with its charter and bylaws. Those documents set out the foundation’s purpose, governance framework and distribution principles. The ADGM courts provide regulatory oversight, meaning they apply common law.
Beneficiaries may be individuals, families or classes of persons. In some cases, there may be no beneficiaries at all, only a stated purpose. This flexibility allows families to separate ownership from control while preserving long term intent.
The role of ADGM foundations in the UAE
Historically, asset holding structures in the UAE relied heavily on corporate vehicles. Trusts were less familiar, particularly for families from civil law backgrounds. The ADGM foundation regime was designed to address that gap.
The ADGM courts provide regulatory oversight, meaning they apply the English common law framework. This provides legal certainty, clarity on fiduciary duties and comfort for international advisers. It also supports confidentiality, as foundation arrangements are not publicly disclosed.
As a result, ADGM foundations are now commonly used for succession planning, family wealth structuring and holding investments, operating companies and real estate.
Key features of an ADGM Foundation:
Exempt and non exempt foundations
ADGM foundations fall into two categories: exempt and non exempt.
Exempt foundations are not required to appoint an ADGM registered Company Service Provider. To qualify, the foundation must demonstrate sufficient substance, resources and governance within the UAE.
Non exempt foundations are required to appoint a registered Company Service Provider. This typically applies where the foundation does not meet the exemption criteria.
Evidence to support exempt status may include details of assets, organisational structures, commercial licences, turnover, personnel, or in house compliance and legal resources. Each application is assessed on its own facts.
The distinction affects ongoing compliance and administration.
How an ADGM foundation is established
The ADGM foundation application process is efficient and largely digital. It does not require document attestation. In most cases, establishment can be completed within a short timeframe once documentation is in order.
The process typically involves four stages:
- Creation of an online profile and preparation of the required documentation
- Submission of the completed application
- Review and decision by the ADGM Registration Authority
- Issuance of the foundation licence in electronic form
It must maintain a foundation’s registered office in ADGM, either directly or through a registered agent
Key documents and information required
Establishing an ADGM foundation requires careful preparation. Information is needed for the founder, council members and beneficiaries, or a designee where no beneficiaries are appointed.
The application will include identity documentation, evidence of appointments, the foundation charter and supporting declarations. Where applicable, details of the Company Service Provider must also be provided.
Getting this right at the outset avoids delays and ensures the structure operates as intended.
How Sovereign can help
Sovereign has an active ADGM Corporate Service Provider (CSP) license which allows us to advises families and asset holders on the establishment and ongoing operation of ADGM foundations. We assist with structuring, documentation and regulatory interaction, and act as registered agent where required. These are instrumental structures to preserve family wealth, intellectual property (IP) and overall asset protection.
We also provide ongoing administration, governance support and foundation council services for ADGM Foundation regulations. Foundations are long term structures and therefore require proper structuring. They benefit from continuity, institutional knowledge and consistent oversight.
That is where experience makes a difference.
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Please contact us if you have any questions or queries and your local representative will be in touch with you as soon as possible.
