The Abu Dhabi Global Market (ADGM) is a financial free zone located in the heart of Abu Dhabi. ADGM occupies the whole of Al Maryah Island and has been designated the financial centre of Abu Dhabi, with its own civil and commercial laws. Established by Federal Decree in 2013, the ADGM is a key pillar of Abu Dhabi’s Economic Vision, designed to act as a catalyst for the growth of a dynamic financial services sector in the UAE.
The ADGM Free Zone became fully operational in October 2015 and is controlled by three independent authorities – the Registration Authority, the Financial Services Regulatory Authority (FSRA) and the ADGM Courts.
The Registration Authority handles all aspects of incorporation, registration and licensing of legal entities in ADGM. In addition, it provides all ‘government-related services’ for entities and professionals working on Al Maryah Island. The team will provide guidance, review and process applications submitted by applicants who wish to establish a legal entity in ADGM.
The FSRA aims to establish a robust, well-regulated and enduring financial market that is aligned with international standards and best practices of global financial centres such as London, Hong Kong and Singapore. As an international financial centre, strategically positioned in the growing economies of the Middle East, Africa and Asia, ADGM will be an open platform that provides a wide spectrum of services covering banking, insurance, wealth management, asset management and capital market activities.
Through regular and close engagement with all stakeholders, ADGM is determined to promote soundness of financial institutions, facilitate innovation and entrepreneurship, encourage efficient risk management and garner investors’ confidence through fair-dealings. ADGM will continue to work closely with stakeholders and market participants to identify strategies and implement initiatives to further enhance its financial services sector.
ADGM Courts and its judiciary are broadly modelled on the English judicial system to create a coherent, recognised and accepted legal framework and judicial system. The direct application of English common law makes ADGM the first jurisdiction in the Middle East to adopt a similar approach to that of Singapore and Hong Kong.
The foundation of the civil and commercial law in ADGM is provided by the Application of English Law Regulations 2015, which make English common law (including the rules and principles of equity) directly applicable in ADGM. In addition, a wide ranging set of well-established English statutes on civil matters are also made applicable in ADGM. ADGM Courts do not have jurisdiction in criminal matters.
ADGM is not only for financial services. Its legal and operational platform is attractive for a broad range of professional and business services, along with family businesses, corporate headquarters and various management functions. It also provides a beneficial environment for domicile holding companies, special purpose vehicles and other structures to hold and protect assets.
The Dual Licensing Regime permits ADGM registered entities that hold a valid ADGM commercial license to apply for a licence issued by the Abu Dhabi Department of Economic Development (DED) which authorises them to conduct business activities outside the borders of ADGM without the need to maintain additional office space in mainland Abu Dhabi.
Sovereign Corporate Services has established an office in the ADGM and was recognised as the first licensed ‘Corporate Services Provider’ within its regulatory framework.
Benefits of operating from ADGM
- 100% foreign ownership
- Ease of setting up businesses
- 0% personal and corporate tax
- Unlimited repatriation of capital
- No restrictions on employment
- State-of-the-art infrastructure and Grade A office space
- Public Companies
- Private Companies
- Restricted Scope Companies (RSC)
- Cell Companies
Types of business entity available for set-up
The ADGM’s legal framework for incorporation, registration and licensing of legal entities is provided by the Companies Regulations and Commercial Licensing Regulations. Based on the UK Companies Act 2006, which are widely known and used in international business, they provide for the following types of entities:
To obtain a licence from ADGM to commence operations, an applicant must first identify the category of business activities and the type of company to be formed. ADGM establishments may be limited by shares or by guarantee, or they may be unlimited. Branches of a foreign company may also register.
Partnerships may also establish themselves in the ADGM free zone. The Limited Liability Partnerships Regulations 2015 provide for the establishment and operation of limited liability partnerships as a corporate structure.
Special Purpose Vehicle (SPV) regime
The ADGM has implemented a comprehensive, cost effective and flexible Special Purpose Vehicle (SPV) regime, which is a corporate vehicle established for the purpose of isolating financial and legal risk by ring-fencing assets and liabilities. SPVs can be established as subsidiaries, project or joint venture vehicles, to ensure that only those assets related to a transaction are exposed to the liabilities associated with that transaction.
Types of business premises available
Sovereign Corporate Services is located on the 35th floor of Al Maqam Tower on Al Maryah Island and can provide the registered address and act as the registered agent for ADGM-registered entities. We have further entered into terms with Regus Serviced Offices to provide our clients with excellent ADGM serviced office facilities and a professional meeting environment within Grade A workspaces. Please contact us for information as to how we can support your Abu Dhabi market entry and office arrangements.