What is an ADGM SPV?
ADGM Special Purpose Vehicles can be established to isolate financial and legal risk by ring-fencing assets and liabilities. The SPVs can act as holding companies, or for the securitization of assets and liabilities on a per-transaction basis. Clients also SPVs to hold Intellectual Property such as trademarks, patents, and copyrights.
An SPV in the ADGM is a versatile vehicle, offering many features that had earlier not been seen in GCC companies. Here are some of them.
Multiple classes of shares – each share class can have its own features, voting rights, share value, redemption options, and dividend options.
Customizable Memorandum – While the ADGM offers a template memorandum, the actual use of the vehicle calls for a fully customizable Memorandum.
No attestations of corporate documents – Unlike many free zones, the ADGM does not require attestations of company documents in case of corporate shareholders. This saves clients a lot of time and money.
No restrictions on nationality and ownership.
No minimum share capital.
While the colloquial term of a registered agent is often used in the case of ADGM SPVs, the actual term would be Company Service Provider. The ADGM is a well-regarded jurisdiction due to the checks and balances that it has in place for companies that wish to set up in the center.
Services of a company service provider include the following:
Provision of registered address – in lieu of full-fledged office space. This helps reduce costs substantially. This service is provided on an ongoing basis.
Provision of incorporation services – a one-time service, that involves a complete review of the ADGM SPV application, submission, and followup until receipt of the license.
Assistance in bank account opening – most SPVs in the ADGM require a bank account.
Accounting and bookkeeping – while ADGM SPVs are passive holding entities, they still need to maintain accounts as per the ADGM Companies Regulations.
Corporate secretarial services – an essential component of managing an SPV in the ADGM. Company secretary services cover the mandatory annual general meeting (AGM) and submission of annual returns. Other services include ongoing maintenance of the shareholding and directorship registers, drafting of resolutions and powers of attorney, etc.
How much does all this cost?
The cost of acting as a registered agent for ADGM SPVs depends on the services taken. Usually, company service providers bundle such services in a way that it becomes more economical to take the whole package, rather than opt for ad-hoc services. In other cases, clients take up only certain services depending on their requirements.
The ADGM Company Service Provider Regulations come into effect in April 2021.
All ADGM Special Purpose Vehicles* are now required to appoint a Company Service Provider to carry out company secretarial and registered agent services.
The ADGM Company Service Provider will be the point of contact between the ADGM Registration Authority and the SPV.
10 Leaves is a Company Service Provider in the ADGM and offers the following services to ADGM SPVs:
- Incorporation Agent – assistance in setting up the SPV.
- Registered address – providing the registered office.
- Provision of directors.
- Provision of company secretaries.
- Provision of Authorised Signatories.
- Provision of nominee shareholders.
- Provision of accounting services.
- Customisation of the Articles of Association.
- ESR Filings and notifications.
- Pledge Arrangements and registration.
- Translations and attestations.
- Assistance in bank account opening.
In addition to the above, we offer corporate and commercial services through 10 Leaves Legability.
These include shareholding agreements, IP agreements, Share vesting plans and agreements and ESOPs.
For startups, we offer structuring solutions, including issuance of warrants, SAFE notes, convertibles and maintenance of cap tables.
We provide all our services through a proprietary digital frontend, with a secure digital backend, to ensure that you have a seamless experience, unmatched by competition. As a client, you also have access to our industry-leading media solution that incorporates engaging videos, detailed podcasts and informative publications to keep you updated and informed of the latest developments that affect your company on an ongoing basis.
*some SPVs are exempt, such as entities connected to regulated firms, and those that they are able to demonstrate adequate presence in the UAE