Obtaining an ADGM License for Your Financial Services Business

Abu Dhabi Global Market (ADGM) is a prominent financial free zone in the UAE, operating under its own civil and commercial laws. The Financial Services Regulatory Authority (FSRA) serves as an independent regulator for all licensed financial institutions within ADGM. Companies in ADGM benefit from 100% foreign ownership and a transparent, business-friendly regulatory environment.

This article will guide you through the setup process and explain why Limitless Consulting is the ideal partner for entrepreneurs entering the financial sector.

Why Choose ADGM?:

ADGM is located in Abu Dhabi – UAE, which offers a business-friendly environment that encourages growth and innovation. Here are some benefits of obtaining an ADGM license:

• Strategic Location: ADGM connects you to markets in the Middle East, Africa, and Asia, making it a prime location for international business.
• High Regulatory Standards: ADGM is known for its strict regulatory framework, providing a secure and transparent environment that boosts investor confidence.
• Foreign Ownership: No restrictions on foreign ownership, ADGM offers a financially attractive environment for businesses.
• Innovative Environment: As a hub for FinTech and innovation, ADGM supports technological advancements and support collaboration within its ecosystem.

Financial Services License in ADGM:

In ADGM, the Financial Services Regulatory Authority (FSRA) grants licenses tailored to the specific financial services a company intends to offer. Some of these licenses are:

• Arranging Deals In Investment
• Advising on Investment or Credit
• Managing Assets
• Managing a Collective Investment Fund

Each license category is designed to align with the risk and scope of the business activities involved.  For more detailed information, you can refer to the ADGM Financial Services and Markets Regulations (FSMR).

Capital Requirements

In ADGM, the capital requirements for financial firms are structured according to the type of license they hold. The Base Capital requirement varies significantly, ranging from USD 10,000 for lower-risk firms (such as those holding a Category 4 license) to USD 10 million for higher-risk firms (like those with a Category 1 license). Beyond the Base Capital, firms must also calculate additional capital requirements based on their specific category. Financial institutions must maintain capital at the higher of either the base capital or the additional capital requirement, such as Risk Based Capital or Expenditure Based Capital Minimum (EBCM).

For more details on base capital requirements and risk capital requirements, please refer to the PRU rulebook.

Establishing a Strong Corporate Governance Framework

Licensed companies operating in ADGM must establish robust corporate governance framework tailored to their business needs. This includes setting the company’s objectives and strategies, overseeing senior management activities, and monitoring overall performance. The Board of Directors should possess the necessary skills and experience to effectively carry out these oversight responsibilities.

Key Positions for FSRA-Authorized Firms in ADGM

In ADGM, firms authorized by the FSRA must fill mandatory positions to ensure smooth operations and compliance. These key roles include a Senior Executive Officer (SEO), a Compliance Officer (CO), Money Laundering Reporting Officer (MLRO), and Finance Officer (FO). SEO, CO and MLRO should be UAE resident. Additionally, the firms are also required to appoint Executive or Non-Executive Directors, as per the need and size of their business.

Financial Services Licensing Process

Securing an ADGM license involves several steps. Here’s a simplified guide:

• Define Your Services: Clearly outline the financial services you plan to offer in ADGM. This will help determine the appropriate license category.
• Select a License Category: ADGM offers various type of financial services licenses. Choose the one that best fits your business activities.
• Prepare Your Documents: Gather all necessary documents, including a business plan, financial projections, relevant forms and mandatory manuals to support your application.
• Submit Your Application: Use ADGM’s online portal to submit your application along with the required documents. The regulatory authorities will review it thoroughly.
• Undergo Checks: ADGM will conduct due diligence and background checks to ensure your business’s credibility and reliability.
• Receive In-Principal Approval: Once your application proceed further, you will receive your in-principal approval from the FSRA.
• Receive Final Approval: Once you have met the requirements of in-principal approval, you shall receive the final financial services license from FSRA.

Why Limitless is Your Ideal Partner for ADGM Licensing

Expertise You Can Trust:

At Limitless Consulting (Limitless), our team is familiar with the ADGM regulatory environment. We ensure that your application is thoroughly prepared, meeting all requirements with precision.

Customized Solutions for Your Business:

We understand that every business is different. Whether you are a startup or an established institution, Limitless offers personalized solutions tailored to your specific needs and goals in the financial sector.

Full Support from Start to Finish:

From initial documentation to final approval, Limitless provides comprehensive support. We assist in drafting business plans and mandatory manuals, developing financial projections,  and all other necessary forms to meet licensing requirements.

Guiding You Through Regulations:

Dealing with financial regulations can be complicated. Limitless helps you in every step, from due diligence to background checks, ensuring everything goes smoothly and quickly.

Ongoing Support After Licensing:

Our partnership does not end once you receive your license. Limitless offers post-license services to help you stay compliant with regulatory requirements and manage any necessary license amendments.

In the competitive financial services industry, establishing a presence in ADGM offers strategic advantages. With Limitless by your side, the process of obtaining an ADGM license becomes straightforward and optimized. From personalized solutions to full-spectrum support, Limitless is your trusted partner for success in ADGM’s dynamic financial ecosystem.

Choose Limitless for a partnership that goes beyond just getting a license. We are here to help your business excel in ADGM.

Disclaimer: The purpose of this publication is to create awareness and has been written in general terms. This publication is not for any specific situation and therefore no opinion should be drawn from it for any particular circumstances. Limitless Consulting recommend that the reader of this publication should refer to the official documents referred in the document, seek appropriate professional advice for any particular situation and accepts no liability for any loss as a result of any information mentioned in this publication.