24 October, 2023

All About Abu Dhabi Global Market

abu dhabi global market

What is Abu Dhabi Global Market

Abu Dhabi Global Market (ADGM) is like a special place in Abu Dhabi where businesses can operate and trade. It’s a bit like a small city inside the big city. People set up companies there because it has its own rules and regulations. It’s meant to make it easier for companies from around the world to do business in Abu Dhabi. Think of it as a global hub where companies can grow and connect, kind of like a friendly neighborhood for businesses.


Why Business setup in ADGM

  1. Strategic Location: Situated in the heart of the UAE’s capital, ADGM provides easy access to regional markets, serving as a gateway to both the Middle East and Asia.
  2. Robust Regulatory Framework: ADGM boasts a world-class regulatory framework, offering businesses a stable and secure environment for growth. Its laws are modeled on international standards, ensuring transparency and investor confidence.
  3. Business Flexibility: ADGM offers a variety of legal structures for business setup, catering to diverse industry needs. These structures include companies, branches, and representative offices, providing flexibility for different business models.
  4. Tax Benefits: ADGM is a tax-neutral jurisdiction, with no corporate, income, or capital gains taxes for 50 years, renewable.
  5. Global Reach: The ADGM’s strategic partnerships with international financial centers facilitate global trade and investments.
  6. FinTech Hub: It’s a thriving hub for fintech companies, fostering innovation and collaboration in the financial technology sector.
  7. Legal Infrastructure: With a well-established legal system based on English common law, businesses benefit from legal predictability and transparency.
  8. Support Services: ADGM offers a range of business support services, including access to professional advisors, co-working spaces, and networking opportunities.
  9. Quality of Life: Abu Dhabi’s high standard of living, coupled with safety and a cosmopolitan culture, attracts skilled professionals and expatriates.


Activities & Legal Structures in ADGM – Abu Dhabi Global Market


1. Legal Structures:

  • ADGM Company Limited by Shares (Ltd.): Ideal for businesses looking for a traditional corporate structure with share capital.
  • ADGM Company Limited by Guarantee (Ltd. G): Suitable for non-profit organizations and associations.
  • ADGM Private Company Limited by Shares: A more flexible option for smaller businesses with limited liability.
  • Branch and Representative Office: Foreign companies can establish a presence in ADGM through branches or representative offices.


2. Financial Services:

  • Banking and Financial Institutions: ADGM provides a conducive environment for banking, asset management, and investment firms.
  • Fintech: It’s a thriving hub for fintech startups and companies, fostering innovation in the financial technology sector.


3. Professional Services:

  • Law Firms: ADGM is home to numerous law firms offering legal services to businesses and investors.
  • Accounting and Auditing Firms: Professional services firms assist with accounting, auditing, and financial reporting.


4. Holding Companies:

  • Businesses can set up holding companies to manage and control investments in subsidiaries.


5. Real Estate:

  • ADGM allows businesses to invest in real estate, development, and property management.


6. Consultancy and Advisory Services:

  • Firms can provide consulting and advisory services in various sectors, including finance, technology, and more.


7. Trade and Commerce:

  • Import/export, distribution, and general trading activities are common in ADGM.


8. Intellectual Property and Innovation:

  • Protect and manage intellectual property rights and innovation-related activities.


What you need to know about Registration Authority in ADGM


1. Regulatory Body:

The Registration Authority is the autonomous regulatory body responsible for registering companies and entities within ADGM. It ensures compliance with ADGM’s legal framework.

2. Registration Process:

The Registration Authority oversees the registration process for businesses, ensuring they meet legal and regulatory requirements.

Businesses need to submit the necessary documentation and comply with ADGM’s rules and regulations.

3. Legal Framework:

ADGM’s legal framework is based on English common law, providing a well-established legal system known for its transparency and predictability.

4. Licensing and Permits:

The Registration Authority issues licenses and permits to various entities, including financial institutions, fintech companies, professional services firms, and more.

5. Regulatory Compliance:

The authority plays a crucial role in ensuring businesses adhere to the regulatory requirements, which contributes to the market’s integrity and trust.

6. Support and Guidance:

The Registration Authority offers support and guidance to businesses during the registration process, helping them navigate the complexities of establishing a presence in ADGM.

7. Online Services:

ADGM provides a user-friendly online platform for registration and regulatory compliance, making the process efficient and accessible.


Benefits of operating from ADGM


  1. Strategic Location: ADGM is strategically located in the heart of Abu Dhabi, serving as a bridge between the Middle East, Asia, and the rest of the world. This strategic location provides easy access to a wide range of global markets.
  2. Tax Advantages: One of the most appealing aspects of ADGM is its tax-neutral status. It offers a 50-year exemption from corporate, income, and capital gains taxes, providing significant cost savings for businesses.
  3. World-Class Regulatory Framework: ADGM follows a robust regulatory framework based on international standards. It ensures transparency, investor protection, and regulatory compliance, fostering a trustworthy environment for businesses.
  4. Business Flexibility: ADGM offers various legal structures for company formation, making it suitable for a wide range of industries and business models. Businesses can choose the structure that best aligns with their goals.
  5. Fintech Hub: ADGM is a thriving hub for fintech companies, supporting innovation in the financial technology sector. It provides opportunities for fintech startups to collaborate and grow.
  6. Access to Professional Services: A wide array of professional services, including legal, accounting, and consulting firms, are readily available within ADGM, making it easier for businesses to access essential support.
  7. High Quality of Life: Abu Dhabi’s high standard of living, coupled with safety and a cosmopolitan culture, attracts skilled professionals and expatriates, ensuring a qualified talent pool.
  8. Global Connectivity: ADGM’s strategic partnerships with other international financial centers provide businesses with global connectivity and opportunities for expansion.


Types of business entity available  for set-up in ADGM


1. ADGM Limited Liability Company (LLC):

An LLC is a common choice for small to medium-sized businesses. It offers limited liability for shareholders and the flexibility to have one or more shareholders.

2. ADGM Private Company Limited by Shares (Ltd.):

This structure is well-suited for businesses aiming to limit their liability while having a share capital. It can be a great choice for startups and enterprises.

3. ADGM Public Company Limited by Shares (Ltd.):

Public companies looking to raise capital by offering shares to the public can opt for this structure. It’s regulated and offers the advantage of raising funds from a broader investor base.

4. ADGM Branch Office:

Foreign companies can establish branch offices in ADGM to represent their parent entities. Branch offices are not separate legal entities and are extensions of the parent company.

5. ADGM Representative Office:

Representative offices are suitable for foreign companies seeking market research or promotional activities in ADGM without engaging in profit-generating operations.

6. ADGM Recognized Company:

These are companies already established in the UAE and recognized by ADGM for certain activities. They are subject to the regulations of their home jurisdiction.


Types of Licenses in ADGM


1. Financial Services License:

Essential for entities involved in financial activities, such as banks, investment firms, and insurance providers.

2. Fintech License:

Tailored for fintech companies, this license encourages innovation and supports startups in the financial technology sector.

3. Professional Services License:

Ideal for law firms, accounting firms, and other professional service providers.

4. Commercial License:

Appropriate for businesses engaged in general trading, import/export, and a wide variety of commercial activities.

5. Commercial Banking License:

Reserved for entities focused on providing banking services to corporate clients.

6. Investment Banking License:

Specifically for businesses engaged in investment banking activities.

7. Insurance License:

Designed for insurance companies and intermediaries offering various insurance products and services.

8. Fund Management License:

Suitable for asset and fund management companies responsible for managing investment funds.

9. Gaming License:

For businesses involved in online gaming and e-sports activities, which are regulated within ADGM.

10. Digital Asset License:

Tailored for entities dealing in digital assets, including cryptocurrencies and blockchain-based assets.