Incentive time! There was never a better time to register a business in ADGM and DIFC – here is why!
Most UAE Free zones have introduced incentives to boost business amid CoronaChaos. Arguably the most substantial and impactful incentives for new applicants are found in ADGM and DIFC, two traditionally “High hurdle” jurisdictions.
Never since the launch of ADGM or DIFC – two tier 1 global financial centres – has establishing a presence in these jurisdictions been better value!
In response to the UAE Government’s efforts to provide relief to businesses during the COVID-19 pandemic, a number of UAE free zones have announced major relief packages including fee waivers, rent holidays and waiver of penalties.
Arguably the most substantial and impactful incentives are found in Abu Dhabi Global Market (ADGM) and the Dubai International Financial Centre, free zones with a core focus on financial services (regulated or nonregulated). Both considered tier 1 financial global centres, ADGM and DIFC are traditionally deemed ‘High hurdle” jurisdictions, with operating costs (licenses, rent) to match. For a limited time tough – not anymore!
ADGM initially announced a full waiver of registration fees for new applicants for a limited period [01/04/2020 through 25/05/2020]. It then went to extended its incentive package: 50% reduction on registration and licensing fees for new applicants and a remarkable 100% waiver on continuation fees for applicants migrating from foreign jurisdictions.
ADGM’s new incentives chiefly focus on new applicants for both financial and non-financial licenses and are valid until 31 December 2020.
Down the road in Dubai, the DIFC announced – among other incentives – a similar waiver of registration fees for new applicants: full waiver for the period 01/04/2020 through 30/06/2020, and 50% reduction valid until 31 December 2020.
DIFC’s stimulus package applies to a large scope of activities and structures. Where ADGM excludes a number of ‘special products’ – SPVs, Foundations, VC firms, Tech Start-up applicants, Accelerators / Incubators and Professional Associations –, DIFC’s incentive package is all-encompassing, including the cost-effective prescribed companies and foundations, both of which are routinely used in corporate and private wealth (re-)structuring.
DIFC Foundations, in particular, have gained substantial momentum. Compatible with all asset classes (real estate, shares, portfolios), they enable the entrepreneur and his family to consolidate and keep control over income-generating assets and investments, while protecting them from potential threats – i.e. creditors attacks, probate. They are equally effective for Muslims and non-Muslims.
With a number of entrepreneurs in the process of restructuring high-value assets for legacy planning and/or risk-mitigating purposes, DIFC’s approach is particularly timely.
COVID-19 is putting all business under extraordinary stress. For those considering launching a financial or non-financial business from a tier 1 financial centre, or to restructure high-value assets, the incentives packages availed by ADGM and DIFC are a unique opportunity to establish a presence in a tier 1 financial centre, at sensational value!
Will you take advantage?