On 17th March 2021, the Abu Dhabi Global Markets (‘ADGM’) Board of Directors enacted legislation which directly impacted on Special Purpose Vehicles (‘SPV’) and Foundation that are located within ADGM jurisdiction.
All Corporate Service Providers (‘CSP’) who are currently providing or intending to provide services to other corporates under their Commercial Licence obligations will also have to meet criteria and maintain certain controls to keep their licence.
Why is this happening?
The ADGM is globally recognised as a prominent jurisdiction regarding good governance and transparency for which companies as well as CSPs are intending to be set up and it is constantly thriving to enact legislation to improve rules and regulations for all entities. This change is consistent with this philosophy to bring ADGM in line with global standards.
What is the role of the CSP?
The overall aim of a CSP is to primarily help facilitate the intentions of SPVs and Foundations but also, importantly to improve governance for the entities internally and with their dealings with the ADGM Registrar. The CSP is usually tasked with certain responsibilities for the entities such as offering a Registered Office Address; Company Secretarial services; Accounting; Bookkeeping and many more.
Every CSP will have additional obligations under this new legislation such as acting as Registered Office provider; liaison between the entity and ADGM Registrar and helping to facilitate all obligatory filings on behalf of the entity before stated deadlines.
Which entities will be impacted overall?
All SPVs and Foundations that are deemed to be non-exempt.
Which entities will not be impacted?
Certain SPVs and Foundations that can satisfy a large degree of “substance” or “presence” in UAE which will include significant assets, resources, experience or are licenced and regulated by the Central Bank of UAE.
When do these rules come into effect?
From 12th July 2021.
What will this mean in practice?
Essentially, all existing non-exempt SPVs and Foundations that have not engaged with a CSP either prior to or post-incorporation, are obliged to appoint a CSP within 12 months of the date this legislation comes into effect or by their next Commercial Licence renewal date, whichever the earlier.
All new non-exempt SPVs and Foundations will need to appoint a CSP prior to incorporation from 3 months after the effective date, i.e., 12 July 2021.
How can Apex help?
Apex has experience and appropriate licensing to provide Registered Office, Company Secretarial, Accounting, Payroll, HR and other such Corporate services for SPVs and Foundations, hence are able to be appointed for those entities that are impacted by this new legislation.
Please contact us for more information.
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