Advantages of Setting Up in ADGM - 10 Leaves

  • 22-06-2020
What is the ADGM?

The ADGM is an International financial center in the MENA region for business and fintech. The quality of ADGM’s independent regulator, the prevailing common law framework, excellent infrastructure, and tax efficiencies make it the perfect base to take advantage of the rapidly growing demand for financial and business services in Abu Dhabi and the greater MENA region. 

 

Why setup a financial services firm in the ADGM?

The ADGM is one of two international financial centers in the UAE. Established in 2015, it quickly rose through the rankings and is now counted as one of the top 25 financial centers in the world. ADGM’s innovative SPV regime, its initiatives in the fintech space and its issuance of the region’s first cryto-asset regulatory framework, have all contributed to its success.  

Financial Service Companies:

Firms that wish to engage in financial service activities, will find that the ADGM as a jurisdiction brings with it credibility and certainty. The laws and FSRA Regulations are comprehensive, robust, and clear. Prospective clients take comfort in the fact that ADGM-based companies are well regulated. Institutions and market counterparties find it easier to deal with ADGM firms, since they are onshore.

Financial firms that operate in markets around the world can use their ADGM setup to cover the time gap between London and Europe in the West, and Mumbai and Shanghai in the East.

There are over 1,000 firms that currently operate out of the ADGM. This in itself has created a financial ecosystem where firms can engage, discuss and make deals, hold events and conduct business. A strong network of service providers such as consultancies, audit and accounting firms, and corporate service providers further makes ADGM the jurisdiction of choice in Abu Dhabi.

The following financial service activities can be carried out from the ADGM:

  • investment banking
  • private banking
  • fund management
  • asset management
  • brokerage and
  • investment advisory services

Read our detailed article on licensing categories within the ADGM here

Non-financial companies:

The world’s most successful financial centres create a broad base of economic activity. Non-financial firms provide the goods and services that core financial firms require in order to operate effectively. These include business consultancies, law firms, professional service providers and even businesses such as travel agencies and translation services.

Not everything revolves around work however. Professionals look for a holistic lifestyle, and personal services such as tailoring, salons, gymnasiums, retail outlets such as restaurants and coffee bars, and even fine dining options to entertain their clients.

The ADGM also offers a wide range of non-regulated activities, such as corporate offices, regional headquarters, family offices, holding companies and proprietary investment companies. Consultancies, service providers and product providers can also establish in the centre. These entities are not subject to regulation by the FSRA, and are authorised directly by the ADGM Registration Authority.

Retail Outlets:

The ADGM is situated in a prime location in Abu Dhabi, on Al Maryah Island. Next to Galleria Mall and Reem Island. This presents a lot of opportunities for retail concepts, both high-end and bespoke. There already exist a number of fine dining options, tailoring and shopping outlets and cafes in the Galleria Mall and it’s newly-created extension.

Specific Advantages:

Here are some specific advantages of establishing in the Abu Dhabi Global Market:

FRAMEWORK:

  • The legal framework supports cross-border activities
  • 100% foreign ownership permitted, no restrictions on capital repatriation
  • No restriction on foreign employees

TAX EFFICIENCIES:

  • Zero tax for 50 years on profits, capital or assets
  • Zero tax on personal income

CONFIDENCE:

  • Well regarded, independent regulator
  • Independent, English-speaking, common law judicial system
  • Distinct from the UAE civil courts 
  • Risk-based regulatory approach

ECOSYSTEM:

  • High prominence in deal making in the region
  • Concentration of international financial institutions
  • World-class regional and international professional services
  • A growing fund domicile in the region

GEOGRAPHIC EPICENTRE:

  • Management offices, holding companies and family offices are located closer to the assets they own or manage
  • The Middle East, Africa and South Asia (MEASA) is increasingly the center of gravity for the global economy
  • The UAE plays a central role in the growing South-South trade, principally between Asia and Africa
  • Well-positioned to harness the potential of emerging markets.

Conclusion:

The ADGM is a premier destination to live and work in Abu Dhabi, and brings with it several advantages and efficiencies. Setting up a company in the ADGM allows financial companies to have a base in the capital of the United Arab Emirates and cater to the expanding MENASA market. It also helps service providers to have a presence in the heart of new Abu Dhabi, and service multinational firms from the world over. And yes, retail concepts are able to get traction by attracting the attention of high-end clientele!

For more details about ADGM Services,  Please Contact Us 

 

 

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