The United Arab Emirates is a collection of seven emirates, with Abu Dhabi being the capital. It is also the biggest emirate in UAE, and contributes nearly two thirds of the UAE’s economy. Careful planning and stringent laws transformed Abu Dhabi into a financial hub, with adequately capitalized banks and a lot of good sovereign wealth funds.
The Abu Dhabi Global Market
The unexceptional growth of GDP at 11%, Abu Dhabi has become one of the world’s largest sovereign wealth funds with highly capitalised banks.
The Emirate of Abu Dhabi introduced their first financial free zone, under the name “Abu Dhabi Global Market” or ADGM. Having its own rules and regulations, Abu Dhabi Global Market is located within the Al Marayh Island, and doesn’t come under any other jurisdiction. ADGM comprises of three main authorities: The Registration Authority, ADGM courts, and the Financial Services Regulatory Authority and soon to be launched the Arbitration Centre for creating a business environment that will allow the companies to carry on the business with ease and in a smooth manner.
It is to be noted that companies established in ADGM can have 100 percent foreign ownership are subject to a civil law commercial and regulatory environment. The ADGM courts settle all disputes within the Abu Dhabi Global Market. The Registrar is responsible for regulating ownership, taking care of all legalities and issuing penalties whenever required. It is also responsible for the monitoring compliance of the commercial laws laid by the ADGM that includes levying penalties, directions, suspension and withdrawing the licenses based on the severity of non-compliance.
The FSRA is responsible for transparent and smooth financial management of ADGM. All the activities related to policy and legal, banking and insurance, capital markets, enforcement, international affairs, and financial centre development are undertaken by them.
Services provided by ADGM:
ADGM is not only for just business based on finance, it is for all kinds of businesses. What attracts businesses to ADGM is that it offers solutions to a variety of business activities, such as commercial, professional, management oriented, family businesses, corporate headquarters, etc. In the Abu Dhabi Global Market, there are financial, non-financial and retail businesses. The term “financial” covers all banks, brokers, agents, wealth managers, fund managers, etc. Non-financial activities consist of things like manufacturing, real estate, information, communication, education, transport, etc. Retail activities can consist of manufacturing and sale of textiles, jewellery, food & beverage, etc.
Steps for incorporation:
Every business entity has a different incorporation process because of the varied requirements. But, here is the general outline of the incorporation process that is followed by a private company limited by shares:
- Step 1: the proposed company name should be in compliance of the ADGM Business and Company Names Rules 2016.
- Step 2: Registered address must be located in Al Maryah Island, Abu Dhabi, UAE
- Step 3: The incorporation documents and business plan is prepared as well as the access to the ADGM online portal is granted.
- Step 4: All the documents such as Articles of Association, shareholders resolution etc. are prepared and submitted along with the duly filled application form.
- Step 5: A certificate of incorporation and commercial license is issued when registrar is satisfied with all the documents and information filled in the application form.
Attractive Features of ADGM:
Its wide range of business related activities is not the only reason why ADGM is seen as good investment destination by foreign investors. ADGM also has an extremely sophisticated and crystal clear legal system, and a prompt legislative regime, wherein foreign investors can conduct business in Abu Dhabi without a lot of legal troubles.
Businesses in ADGM can be owned completely by foreign nationals without the need to have 51% of it registered in the name of a UAE national.
ADGM has opened new avenues for businesses in Abu Dhabi and made it a financial free zone. The simplified incorporation requirements, abridged legislative regime, and the business-friendly infrastructure are attracting the businesses to Abu Dhabi.