What to Know About Recent Changes in ADGM Laws and Your ADGM Company Obligations

We would like to remind you regarding the following items at Abu Dhabi Global Market (“ADGM”):

1. New Residency Requirements for Authorised Signatories of ADGM Entities

• Under Commercial Licensing Regulations 2015 (Conditions of Licence and Branch Registration) Rules 2019, each ADGM entity is now required to have at least one (1) authorised signatory who holds a valid UAE residency visa.
• This requirement applies to existing ADGM entities as well as ADGM SPVs.

What does this mean for my business?

It means you need to make sure at least one of your authorised signatories is a UAE resident.

2. Disclosing Ultimate Beneficial Owners

• Under Beneficial Ownership and Control Regulations 2018, every ADGM entity is considered to have ultimate beneficial owners (“UBOs”).
• The UBOs may include shareholders, the beneficial owners pursuant to a nominee agreement, and the parties to a trust structure.
• Each ADGM entity shall prepare and file with the ADGM Registration Authority a “Record of Beneficial Owners” that discloses the relevant UBOs.
• Failure to do so may result in ADGM imposing on your entity a maximum fine of USD 25,000.

What does this mean for my business?

It means you need to maintain a UBO register for your ADGM entity, file it with the ADGM Registration authority, and update your current UBO disclosure as needed.

3. VAT Registration Obligations

• Under the Registration Authority Circular No (2) of 2019: Value Added Tax (“VAT”) Registration Compliance notice, the Registration Authority urges all ADGM entities to review whether they are required to comply with Federal Decree-Law No. 8 of 2017 (“UAE VAT Law”).
• In this connection, although the VAT legislation sets out exceptions on the import of goods into and on supplies of goods made within or between VAT designated zones, ADGM has not been designated as such and therefore these VAT exceptions do not apply.
• An ADGM entity may be required to register for VAT purposes or may register on a voluntary basis, depending on several factors.

What does this mean for my business?

It means you should verify if your ADGM business is required to register under the UAE VAT Law and if so, carry out the registration.

4. Filing Requirements for Entities registered in ADGM

• Under the ADGM Companies Regulations 2015, each ADGM entity is subject to the following filing requirements:
  • Annual Filings:
    • Annual return;
      • at time of renewing commercial license;
    • Annual Accounts
      • Due date depending on accounting reference; and
      • Financial disclosures dependent on entity revenues and employee headcount.
    • Ad Hoc Filings:
      • Changes in director;
      • Change in shareholder;
      • Change in UBO (as discussed above);
      • Change in registered office address; and
      • Allotment of shares.

What does this mean for my business?

It means each year you need to (1) complete the Annual Filings and (2) make the Ad Hoc Filings if the relevant triggering circumstances occurred.

Our team of experts would be delighted to help you regarding your ADGM UBO compliance, VAT registration obligations and filings requirements.

Hassan Al Jarrah
Head of Corporate Structuring – Abu Dhabi
h.aljarrah@tamimi.com

Nasouh Raslan
Associate, Corporate Structuring
n.raslan@tamimi.com

Xavier Solanes
Associate, Tax
x.solanes@tamimi.com