ADGM — Abu Dhabi Global Market

The distinction almost every comparison gets wrong

Most guides file ADGM and DIFC together as "the two common law free zones". That is accurate about DIFC and imprecise about ADGM, and the imprecision hides the only structural difference that matters.

DIFC wrote its own statutes, modelled on English law. ADGM largely did not. Under the Application of English Law Regulations 2015 the common law of England — including the rules and principles of equity — applies directly in ADGM and forms part of its law, subject to ADGM's own circumstances and legislation. Facing a question the regulations do not answer, an ADGM court reaches for English case law itself.

For a marketing agency that is a footnote. For a shareholders' agreement foreign counsel must sign off, a security package a lender may need to enforce, or any structure depending on equitable remedies, it is the whole reason to be here.

What ADGM is and who runs it

ADGM is a financial free zone on Al Maryah Island in Abu Dhabi, operating since 2015. On 24 April 2023 its jurisdiction expanded to absorb Al Reem Island, producing a district ADGM puts at 14.38 million square metres. Businesses already trading on Al Reem had to hold an ADGM licence by 31 December 2024; the integration brought in over 1,100 entities, roughly half of them existing companies with no say in it.

Three independent bodies run it, and confusing them wastes months.

The Registration Authority incorporates entities, issues commercial licences, maintains the beneficial ownership record and houses the Office of Data Protection. Every ADGM company deals with it.

The Financial Services Regulatory Authority (FSRA) authorises and supervises financial services under the Financial Services and Markets Regulations 2015. Only firms carrying on a regulated activity deal with it — but they deal with it first.

ADGM Courts are independent English-language common law courts, sitting alongside the ADGM Arbitration Centre.

Scale, on ADGM's own half-year 2025 figures: 11,128 active licences, 2,972 operational entities of which 308 are financial, 154 fund and asset managers, 209 funds, and 35,964 people across the two islands.

Who it genuinely suits

Holding and ring-fencing structures. ADGM's strongest product by a distance, and the one it is least loud about. An SPV isolates an asset — shares, property, intellectual property, a joint venture interest — inside a common law entity with no office and no staff, for under USD 2,000 a year in authority fees. Nothing regional matches it on quality and price together. Where the holding entity is meant to take outside money rather than only hold assets, the jurisdiction is part of the funding question, and the structures that make a UAE company hard to invest in works through what a funding round tests.

Regulated financial services. Asset and fund management, brokerage, advisory, insurance intermediation, payments, banking. ADGM entities listed on the Abu Dhabi Securities Exchange carry a combined market capitalisation above AED 500 billion.

Digital assets. ADGM built a virtual asset framework in 2018, before most regulators had a position, and runs an Accepted Virtual Assets regime under which only FSRA-approved assets may be offered. Restrictive curation — and why institutional counterparties take the licence seriously.

Family offices and succession structures, through foundations and restricted scope companies.

The honest filter: ADGM earns its cost if your structure needs common law, your activity needs FSRA authorisation, or you are ring-fencing an asset. If none is true, you are buying an Abu Dhabi address at a premium.

A foreign founder can own every share, and the profit leaves on company law's timetable

ADGM imposes no foreign ownership restriction. An ADGM company can be held outright by foreign individuals or foreign companies, with no UAE national partner to bring in and no local shareholding to engineer around. ADGM states 100% foreign ownership as its position across its business areas, and it applies to every company structure on this page, from the SPV to the FSRA-authorised firm. Ownership does not depend on residence either: a foreign parent can hold an ADGM SPV without anyone in the group ever holding a UAE visa, because owning the shares and living in the country are separate files.

Three things still sit on top of that ownership, and none of them is waived because the owner is foreign.

• The regulator reads the cap table of a regulated firm. For an FSRA-authorised firm, the people who control it are part of what was authorised, and a change in control needs the FSRA's approval before it happens. A share sale completed first and explained afterwards is a breach, not a late form.
• Ownership is known to the authority, not to the public. Changes reach ADGM inside the 15-day window set out under compliance below, and the beneficial ownership record itself is not published: access is limited to designated staff at the authority. That is narrower than it sounds. ADGM publishes a good deal about its companies through public lookups, and a free zone hides your ownership from competitors and nobody else explains why nobody should choose ADGM for discretion.
• Foreign ownership still has to explain the structure. The nexus test applies whoever the owner is. A foreign group with a real connection to ADGM, the UAE or the GCC is exactly who the SPV regime was built for; a foreign owner with no regional link is refused, however complete the ownership.

None of this is a reason to pick ADGM over anywhere else. Every UAE free zone offers full ownership, and since the 2020 reform of the federal Commercial Companies Law most mainland activities can be wholly foreign-owned too, activities with a strategic impact excepted. Which free zone benefits survived the reforms sorts the rest of the brochure list the same way. What ADGM offers that the others do not is the law applied to those shares, which is where this page began.

No UAE tax is deducted on the way out, and three gates still decide when money moves

ADGM's own position is that there are no restrictions on repatriating profits, and federal tax takes nothing at the border: the withholding rate the corporate tax law applies to payments to non-residents stands at 0%, so a dividend paid to a foreign shareholder leaves without a deduction at source. No permit is needed to send capital home either. Whether money actually moves is decided by three gates the brochure line leaves out.

1. Company law decides whether there is anything to distribute. ADGM's Companies Regulations 2020 follow the English model: a distribution may be made only out of profits available for the purpose, which means accumulated profit shown in the accounts, net of losses, not a healthy bank balance. Returning share capital is a separate procedure — a reduction of capital, which a private company can carry out by special resolution backed by a directors' solvency statement, and any company by special resolution confirmed by the ADGM Court. Money sent upstream without either ends up on the books as a balance the shareholder owes the company, whatever the payment reference says.
2. Corporate tax has already taken its share. The distribution adds no UAE tax, but the profit behind it has already borne corporate tax unless it was qualifying income of a Qualifying Free Zone Person taxed at 0%. As the compliance section explains, a property SPV usually does not clear that test.
3. The bank decides when the transfer clears. The questions asked when the account was opened — who owns the company, where the money came from, what the payment is for — are asked again at the first large outbound transfer. Paperwork assembled after the money has moved reads as exactly that, and the transfer waits.

Holding structures meet all three at once, because an SPV exists to receive dividends from below and pass them up. Repatriating profit from a UAE company works through the order of operations, the five routes money takes out of a company, and why a lawful payment can still be held.

Licence types and what each permits

Non-financial commercial licence. Professional services, consultancy, corporate headquarters, technology, media. No FSRA involvement. Requires premises.

Retail licence. Food, beverage and retail units inside the district.

Special Purpose Vehicle. A passive holding entity that may own assets, hold shares, receive dividends and be party to financing. It may not conduct operational business and may not employ staff — so, as below, it cannot sponsor visas. Every SPV must show an acceptable connection, or "nexus", to ADGM, the UAE or the GCC; a vehicle with no regional link is refused. Since 12 July 2021 most must appoint an approved Company Service Provider, which supplies the official office address and files on their behalf.

Restricted Scope Company. An SPV variant with limited disclosure on the public record, open only to defined applicants — typically group subsidiaries and family businesses. Genuine privacy, narrow eligibility.

Foundation. An orphan structure for succession, philanthropy and family governance, holding assets in its own name with no shareholders.

Tech Startup Licence. A discounted commercial licence, incentivised for up to three years before transitioning to standard fees. Not a product you can simply buy — see the cost and premises sections.

Financial Services Permission. Issued by the FSRA against the regulated activities in Schedule 1 to the FSMR, the firm assigned a prudential category from 1, 2, 3A, 3B, 3C, 4 or 5 by what it actually does. Separately the RegLab lets fintech firms test live with real customers for up to two years before full authorisation.

What setup involves, in the order it happens

For a non-financial entity, an SPV or a foundation, the sequence is short. Settle the structure and the nexus story; reserve the name; appoint a Company Service Provider where required; submit through ADGM's online filing portal with constitutional documents and shareholder due diligence; sign the lease or the official office address agreement; receive the licence. ADGM states a complete application is approved within ten business days, foundations in three to five. In practice, attesting shareholder documents from abroad sets the real timetable.

For an FSRA-regulated firm the order reverses, and this is the expensive misunderstanding. Regulatory approval precedes the company.

1. Pre-application engagement with the FSRA on the perimeter question — whether what you do is a regulated activity carried on "by way of business" in or from ADGM at all.
2. Full application: regulatory business plan, projections, compliance and AML manuals, and an application for each Approved Person.
3. In-Principle Approval — conditional and time-limited, not a licence.
4. Only then: incorporate, take premises, deposit base capital, install the mandated appointments.
5. Permission granted, then data protection filing, establishment card, visas, banking and Federal Tax Authority enrolment.

Budget months, not weeks, carrying rent and senior salaries throughout. Adding a regulated activity later is a chargeable application of its own — that fee doubled to USD 10,000 on 1 January 2024.

Both routes turn on one question, and it is asked before either of them starts:

Put plainly: a non-financial entity, an SPV or a foundation runs name, filing, premises and licence in that order — ten business days for a complete application and three to five for a foundation — while a firm the FSRA has to authorise runs pre-application, full application, In-Principle Approval, incorporation and only then permission.

What it costs

Authority fees move, and ADGM's moved sharply. A revision effective 1 January 2025 cut some categories and raised others. Below are ADGM's published fees at the time of writing — a planning baseline, not a quote. Confirm each against the current schedule.

The SPV figure breaks down as USD 200 name reservation, USD 700 incorporation and USD 1,000 licence. Add a USD 300 data protection fee at incorporation and on each anniversary.

Two corrections to what circulates elsewhere. Non-financial setup got cheaper in 2025 — pages quoting USD 10,000 are two years stale. And the Tech Startup Licence is USD 1,500; the USD 1,000 and USD 4,000 figures on adviser sites are both wrong.

FSRA base capital, after the prudential amendments effective 19 August 2025: Category 3A USD 500,000; 3B USD 4 million; 3C USD 250,000; Category 4 USD 50,000, or USD 150,000 for private financing platforms. That last figure was USD 10,000 until August 2025 and most published guidance has not caught up. Categories 1, 2 and 5 sit materially higher — confirm yours against the current PRU module, not any summary including this one. Minimum professional indemnity standards apply from 1 January 2026.

At the pegged rate of AED 3.6725 to the dollar, indicative first-year totals from our own engagements, not quoted fees:

In figures: AED 25,000 to 55,000 for an SPV with a Company Service Provider, AED 40,000 to 90,000 for a foundation, AED 60,000 to 130,000 for a Tech Startup Licence with a dedicated desk, AED 130,000 to 300,000 for a small non-financial office with three or four visas, and AED 350,000 to 800,000 to carry an FSRA Category 4 advisory firm to permission.

For an SPV, note where the money actually goes: the Company Service Provider's annual fee routinely exceeds the USD 1,900 paid to the authority. That is the recurring number to negotiate, and nobody advertises it.

Visas, and why the desk decides them

There is no package-based allocation. ADGM's own position is that quota is assessed case by case against business activity, office space and health and safety requirements.

Working ratios exist. The Tech Startup Licence is documented at three visas per dedicated desk. Non-financial companies are commonly cited at two per desk or one per eight square metres — treat that as indicative and get your own number confirmed in writing by the Registration Authority before signing a lease. Reversing that order is the costliest sequencing error available here.

The point founders miss entirely: an SPV cannot sponsor a single visa. It employs nobody, so there is no immigration file and no establishment card. People buy an ADGM SPV believing it delivers UAE residence; it delivers a holding company. Residence needs an operating entity with premises — a different licence at a different price.

Who processes the visa is the other half of the answer, and in ADGM it is the authority itself. ADGM's Corporate Affairs team runs visas and government services for entities in the jurisdiction, working with the relevant government authorities on the company's behalf, and every request goes through a single online portal, ACCESSADGM. The work permit is ADGM's own — no other body issues one for the district — and it has to be in place before the employee starts work. Under ADGM's employment rules the cost of the permit, and of the residence visa and Emirates ID where they apply, falls on the employer rather than on the hire.

The order before the first employment visa is fixed. The company obtains an establishment card, issued by Abu Dhabi's General Directorate of Residence and Foreigners Affairs and required for every visa service, then an e-channels account on the same directorate's online visa system. Only when both are approved does the portal accept a new employment visa request, so both belong in the first weeks of the timetable, not in the week a hire is due to start. Official letters and activity permits — events, photography, promotions and the like — are requested through the same portal, and the Corporate Affairs team also offers PO boxes and introductions to health insurance providers and banks. An introduction to a bank is not an account, as the banking section below makes plain.

None of it opens for an SPV: with no establishment card, there is no immigration file for Corporate Affairs to process.

Premises: what counts and what does not

Physical space on Al Maryah or Al Reem Island is required for every operating entity, evidenced by a lease or membership agreement filed with the application.

There is no flexi-desk route into ADGM. For the Tech Startup Licence, hot-desking is expressly not accepted — a dedicated desk or office inside the district is mandatory.

The exception is the SPV and, in practice, the foundation: no premises, official office address supplied by the Company Service Provider. That exemption is the whole basis of the SPV's economics.

Premises and visas are therefore one decision rather than two, and it is settled the moment the entity is chosen — not later, at the lease:

The two left-hand routes carry no lease and no residence visa at any price; the two on the right cannot be had without both. That is the line people cross by accident, and it is why the cheapest ADGM entity is the one that most often fails to do what it was bought for.

Al Maryah rents sit in Abu Dhabi's prime bracket and move with the market. Budget from a broker's quote, not a package sheet.

Banking reality

An ADGM licence opens a serious conversation. It does not open an account.

Abu Dhabi's own institutions — First Abu Dhabi Bank, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank — are the natural first approach, and being an Abu Dhabi entity in an Abu Dhabi bank's home market is a real advantage over Dubai zones. International banks engage more readily with FSRA-regulated firms and with subsidiaries of groups they already bank elsewhere; an existing group relationship outweighs any licence.

Two failure modes are specific to ADGM:

• SPVs are hard to bank, and often do not need to be. A passive vehicle with no staff, no premises and no revenue is a thin file for a compliance officer. Many SPVs function perfectly well without a UAE operating account; decide whether you need one before spending three months failing to get it.
• Digital asset firms face enhanced scrutiny regardless of the framework's quality. An FSRA permission helps more than any other regional licence and still guarantees nothing.

The general causes remain: a beneficial owner in a high-risk jurisdiction, an ownership chain the bank cannot see through, a business description that does not match the licensed activity, no UAE-resident senior management, projected flows inconsistent with visible substance. Allow four to twelve weeks for a clean operating account.

The compliance that starts on day one

Corporate tax. ADGM entities are Free Zone Persons under Federal Decree-Law No. 47 of 2022. The 0% rate applies only to qualifying income of a Qualifying Free Zone Person, and only while every condition holds: adequate substance, qualifying income under Ministerial Decision No. 229 of 2025, transfer pricing compliance, audited accounts. Non-qualifying revenue must stay under the lower of 5% of total revenue or AED 5 million. Federal Tax Authority enrolment is required whether or not tax is payable.

Two traps hit holding structures. Substance still applies to an SPV: core income-generating activities must occur in a free zone, so an SPV with no employees relies on outsourcing to its Company Service Provider, supervised and priced at arm's length. And a property SPV is usually not a 0% structure — income from immovable property outside the free zone does not qualify, so an ADGM vehicle holding a Dubai apartment generally faces 9% on the rent. It is the most commonly mis-sold ADGM structure.

Beneficial ownership. Under the Beneficial Ownership and Control Regulations 2022, as amended in February 2024, every ADGM entity except branches of foreign companies and partnerships must keep a record of beneficial owners and report changes to the Registration Authority within 15 days. A short window, missed constantly.

Data protection. Controllers file with the Office of Data Protection before processing and renew annually at USD 300. Miss the one-month grace period after the anniversary and a USD 450 fixed penalty applies automatically under section 24(2) of the Data Protection Regulations 2021 — small, avoidable, one of the most frequent ADGM defaults.

Employment. The Employment Regulations 2024 took effect on 1 April 2025. End-of-service gratuity accrues at 21 days' basic wage per year for the first five years and 30 days thereafter, and the two-year cap is gone. Employers may offer a pension or savings scheme instead; participation is voluntary on both sides.

Economic substance filings no longer exist. Cabinet Decision No. 98 of 2024 confined the regime to financial years ending on or before 31 December 2022. Anyone still invoicing for an annual ESR notification is invoicing for nothing.

AML applies to FSRA-authorised firms and designated non-financial businesses, with UAE-resident compliance and money laundering reporting officers.

Annual accounts go to ADGM as well, and the small-company shortcut does not survive the tax test. Every ADGM company files annual accounts with the authority within nine months of its accounting reference date — audited by an ADGM-recognised auditor or, for a company small enough to qualify, a simplified unaudited balance sheet. That concession is company law only. The corporate tax conditions above still call for audited accounts from a company claiming the 0% rate, so a small ADGM company relying on qualifying income can be entitled to file the short version and still need the full audit.

Almost all of it is filed online, from anywhere. ADGM built its online filing platform — the one the application went through — so that a company can be maintained without a visit to its offices. The annual cycle runs there: the confirmation statement each year, the accounts, the licence renewal and the data protection renewal. So do the event-driven filings: a director appointed or leaving and amended articles within 14 days, a new company name before it is used, a change of the company's address as soon as practicable, and the resolutions behind share allotments, transfers and capital changes. A compliance calendar in the portal shows every user with authority over the entity when the annual filings fall due. Visa and government requests run separately on ACCESSADGM, and an FSRA-authorised firm deals with its regulator through FSRA Connect, the regulator's own portal for returns and for applications such as a change in control.

Online is not the same as remote, and three things still have to exist on the ground. An operating entity renews its licence only against a current lease, so the premises obligation renews with it. A residence visa still needs its holder in the country for the medical test and the Emirates ID biometrics. And a Qualifying Free Zone Person's substance is measured by what happens in the free zone, not by where the filings are sent from. Forming a UAE company from outside the country covers what a founder abroad can delegate and what still needs a trip. Keep more than one person with access to the company's portal accounts: a company whose only authorised user has left finds out at the first missed deadline.

Almost none of the rulebook above is old. The instruments an ADGM company is run under today were quiet through the jurisdiction's early years and then arrived in a rush, which is why so much published guidance still describes a version of ADGM that no longer exists:

In dates: English law applied directly from 2015 and a virtual asset framework in 2018, then the provider requirement on 12 July 2021, Al Reem on 24 April 2023, the added-activity fee doubling to USD 10,000 on 1 January 2024, the Hub71 gate from July 2024, the Al Reem licensing deadline of 31 December 2024, the fee revision on 1 January 2025, the Employment Regulations 2024 in force on 1 April 2025, base capital raised on 19 August 2025, and minimum professional indemnity standards from 1 January 2026.

Where ADGM is the wrong choice

You live and work in Dubai. Nobody in this industry will raise this with you, and it is the most common reason an ADGM setup disappoints. Premises must be on Al Maryah or Al Reem, staff must be visa-ed there, and the drive is not a commute anyone sustains. If your clients and team are in Dubai, you are choosing a jurisdiction you will rarely visit.

You move physical goods. No port, no warehousing, no industrial land, no designated zone treatment for goods under the VAT rules. Trading belongs in JAFZA, RAKEZ or a Dubai commercial zone.

You want a licence primarily to obtain residence visas. An inefficient way to do it, and an SPV cannot do it at all.

You assumed the Tech Startup Licence was purchasable. It is gated: since July 2024 an application without a Hub71 eligibility letter is rejected. Hub71 assesses whether the business is genuinely technology-driven, scalable and deployable in the UAE. Most ordinary companies with a website do not clear it, and being refused costs weeks.

Your holding structure has no UAE or GCC connection. The nexus requirement is a real filter, not a formality.

You are cost-sensitive and unregulated. A non-financial licence at USD 5,000 a year plus real premises is several times what IFZA, SHAMS or Meydan charge for the same consultancy work. Common law is worth paying for only if something in your structure uses it.

You need to sell to UAE mainland customers. An ADGM entity cannot invoice onshore clients for local work without a branch, distributor or dual arrangement. Selling into Abu Dhabi's own market from an onshore licence is a different project with a different set of counters, and business setup in Abu Dhabi is where that route is priced.

You cannot fund the FSRA wait. In-Principle Approval is conditional and time-limited, authorisation runs months and sometimes fails — while premises and salaries run.

One constraint bites hardest at this price point: an ADGM company cannot count on moving elsewhere in the UAE. Federal company law now lets a company transfer between a free zone and an emirate's mainland authority while keeping its legal personality, but only where both authorities' systems allow it and both approve, and a move between a financial free zone such as ADGM and the rest of the country depends on controls the law leaves to the Cabinet. The same law gives no general route from one free zone to another; that turns on both zones' own rules. Where no transfer is available or approved, getting it wrong means liquidating and starting again.

Wrong for ADGM is not wrong for the emirate. Abu Dhabi has routes that sit outside this jurisdiction entirely, and ADGM against Abu Dhabi's mainland and KEZAD is the comparison to settle before the cost of any one of them means much.

The two it is actually weighed against

DIFC is the direct comparison, and the choice is narrower than it looks. Take DIFC if your business is client-facing financial services and your market is Dubai. Take ADGM if your structure needs English common law applied directly rather than codified, if you are holding rather than operating, or if digital assets are central — the FSRA's framework is older and broader than the DFSA's recognised-token approach. Costs are comparable for regulated firms; for non-financial entities ADGM is now cheaper.

RAK ICC is the honest comparison for holding structures, and it is cheaper. If you need an offshore vehicle to hold shares and no lender, investor or court will ever test the framework, RAK ICC does it for less. ADGM's premium buys direct English common law, a recognised financial centre on the letterhead, and courts a foreign counterparty will accept in a dispute clause. If none will be used, take the cheaper vehicle.

For an ordinary unregulated operating business neither is the benchmark — DMCC or a low-cost Dubai zone is, and ADGM loses that comparison on every metric except the law it applies.

Set against each other, what each one is genuinely for and what taking it costs you:

Put plainly: DIFC where the business is client-facing financial services with a Dubai market, RAK ICC where an offshore holding vehicle will never be tested by a lender, investor or court, DMCC or a low-cost Dubai zone for an ordinary unregulated operating business, and ADGM only where the structure actually uses the law it applies.

Before you commit

Tell us what the entity will own or do, who the counterparties are, whether anyone will ever litigate or lend against the structure, and where the people will sit. Those four answers decide ADGM — including when the answer is no.