Recognition of SPV as a distinct holding company in AGDM

Abu Dhabi Global Market holds a special place in the hearts of the UAE business community. As business in the UAE continues to grow, ADGM has evolved rapidly. Among the preferred choices for startups and businesses in ADGM are Special Purpose Vehicles.
A Special Purpose Vehicle (SPV) in ADGM is a specialized legal entity created for specific purposes such as holding assets, managing risks, or undertaking projects. Key features include flexible ownership structures, limited liability for shareholders, and no minimum capital requirement. SPVs benefit from high privacy levels, simplified regulatory compliance, and favorable tax advantages including 0% corporate tax and no VAT.
Table of Contents
Features of an SPV:
- Purpose-Specific Structure: SPVs are designed for specific purposes such as holding assets, facilitating securitization transactions, isolating financial risk, or undertaking specific projects.
- Flexible Ownership: SPVs can have flexible ownership structures, allowing for single or multiple shareholders, which can be individuals or corporate entities.
- Limited Liability: Shareholders have limited liability, protecting their personal assets from the SPV’s obligations and liabilities.
- No Minimum Capital Requirement: ADGM SPVs do not have a minimum share capital requirement, making them cost-effective and easy to establish.
- Privacy and Confidentiality: SPVs provide a high level of privacy and confidentiality, with limited public disclosure requirements regarding the identity of shareholders and directors.
- Simplified Compliance: SPVs benefit from simplified regulatory requirements and reduced reporting obligations compared to other types of companies.
- Tax Advantages: SPVs in ADGM benefit from the UAE’s favorable tax regime, including 0% corporate tax, no withholding taxes, and no VAT on financial services.
- Flexible Management Structure: SPVs can be managed by directors who can be residents or non-residents of the UAE, offering flexibility in governance.
Procedure for Formation:
- Reserve a Company Name: Submit an application with the ADGM Registration Authority to reserve the SPV’s company name. Ensure the name is unique and complies with ADGM naming guidelines.
- Prepare and Submit Documents:
- Prepare the necessary incorporation documents, including:
- Application for incorporation.
- Articles of Association (AoA) outlining the SPV’s governance structure.
- Details of shareholders, directors, and the company secretary (if applicable).
- Obtain Necessary Approvals: Submit the incorporation documents to the ADGM Registration Authority for review and approval. This process typically involves compliance checks and verification of the information provided.
- Pay Fees: Pay the required registration and license fees. The cost varies depending on the type of SPV and the services required from the CSP.
The registration fees to establish an SPV in ADGM are as follows:

- Issuance of License: Upon approval, the ADGM Registration Authority will issue the Certificate of Incorporation and the Commercial License, officially establishing the SPV.
- Post-Incorporation Requirements: Ensure ongoing compliance with ADGM regulations, including maintaining a registered office address, filing annual returns, and adhering to any specific requirements based on the SPV’s activities.
Ongoing Compliance and Administration
- Annual Reporting: SPVs must file annual returns with the ADGM Registration Authority, providing updated information on shareholders, directors, and the company’s financial status.
- Accounting and Auditing: While SPVs benefit from simplified reporting requirements, they may still need to maintain proper accounting records and, in some cases, undergo audits depending on their activities and structure.
- Renewal of License: The SPV’s commercial license must be renewed annually, requiring the payment of renewal fees and submission of any necessary documentation.
Setting up an SPV in ADGM offers significant benefits, including flexibility, confidentiality, and favorable tax treatment. The formation process is streamlined, making ADGM an attractive jurisdiction for establishing SPVs for various business purposes.
Conclusion
ABS PARTNERS can assist you in setting up SPVs in ADGM. Our expert team can guide you through every stage, from reserving your company name to obtaining the required licenses and ensuring ongoing compliance. Our expertise ensures that you take full advantage of ADGM’s business-friendly environment and clear regulations, thereby setting up your SPV for success in the global market. Whether you’re looking to secure assets, finance projects, or meet other business goals, partnering with ABS PARTNERS guarantees a strong foundation and operational flexibility in ADGM’s vibrant financial environment.
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