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Why choose Foundations in DIFC for maximizing wealth preservation?

Why choose Foundations in DIFC for maximizing wealth preservation?
Why choose Foundations in DIFC for maximizing wealth preservation?

The Dubai International Financial Centre (DIFC) stands as a premier financial hub spanning the Middle East, Africa, and South Asia (MEASA) region, ranking among the top 10 global financial centers. Hosting over 5,000 active registered firms and approximately 40,000 professionals, it fosters a thriving business ecosystem. With nearly two decades of operation, DIFC emerged as an independent judicial system, a global financial exchange, with distinctive architecture, and comprehensive support services. Within MEASA, a region comprising nearly three billion people and a nominal GDP of around USD 8 trillion, DIFC has played a pivotal role in facilitating investment and trade flows.

In this landscape of wealth management and asset protection, individuals and families seek robust structures offering financial security, privacy, and adaptability. The DIFC Foundation regime emerges as a compelling solution, providing an array of advantages for those reducing the complexities of wealth preservation. The secure, private, and flexible structures of family wealth management combined with the benefits of the DIFC jurisdiction, position it as a strategic choice in the realm of family wealth management.

What are the benefits of setting up a Foundation in the DIFC, Dubai?

Asset Protection:

One of the primary advantages of establishing a Foundation within the DIFC lies in asset protection. In conventional structures, personal assets may be vulnerable to claims from governments, creditors, or family members. However, the DIFC Foundation ensures a clear separation between the Founder and the Foundation’s assets, shielding them from external threats.

Privacy:

Maintaining privacy in financial matters is paramount, and the DIFC Foundation excels in this aspect. The names of Founders and Beneficiaries remain confidential, avoiding disclosure on official documents such as land registries and company registers. This discretion minimizes the risk of unwarranted claims from third parties.

Tax Planning:

In an era of globalized wealth, families with assets spanning multiple jurisdictions face intricate tax implications. The DIFC Foundation facilitates effective tax planning, providing a structured framework for the smooth transfer of generational wealth while minimizing exposure to taxes and inheritance levies.

Succession Planning:

The DIFC Foundation offers a secure avenue for Founder’s preferences in succession planning. Founders can stipulate their desires for the distribution of assets and related benefits after their demise, ensuring that their legacy aligns with their wishes and the foundation’s conditions.

Specific Advantages of setting up a Foundation in the DIFC:

  1. Legal Autonomy:

The DIFC operates as a financial free zone, boasting its civil and commercial laws. The DIFC Courts, conducting proceedings in English under the familiarity of Common Law, contribute to a legal environment that empowers Foundations with legal autonomy.

2. Asset Diversity:

The Foundation’s assets can encompass a wide array, including shares, bank accounts, aviation assets, and any other legally permissible assets worldwide. This diversity allows for a tailored approach to wealth management.

3. Legal Personality:

DIFC Foundations possess a distinct legal personality, granting them the flexibility to enter into contracts and arrangements independently. This feature aligns them with other incorporated entities, enhancing their legal standing.

4. Re-domiciliation:

Foundations can be redomiciled (migrated) in and out of the DIFC, providing a level of adaptability that is crucial in responding to changing circumstances, regulatory shifts, or family dynamics.

5. Governance Flexibility:

The DIFC Foundation allows for amendments to governance structures post-establishment. This flexibility ensures that the Foundation can evolve in tandem with the family’s changing needs or external regulatory changes.

6. Low Initial Commitment:

Foundations can be initiated with a commitment of assets as minimal as US$ 100, making this wealth management solution accessible to a broad spectrum of individuals and families.

7. No Physical Office Requirement:

Dispelling the need for a physical office, Foundations can leverage the address of a company service provider in the DIFC, reducing operational burdens.

8. Global Presence:

There is no obligation for the Founder or Foundation officers to be based in the UAE, allowing for seamless management from any location globally.

9. Corporate Roles:

All Foundation roles can be assumed by individuals or body corporates, providing a versatile approach to structuring.

10. Limited Public Disclosure:

The DIFC public register maintains a high level of confidentiality, omitting individuals’ names from public scrutiny.

11. Minimal Reporting Requirements:

With no mandate for annual returns, accounts, or audits, the DIFC Foundation simplifies administrative processes, ensuring a focus on wealth preservation.

To explore more about the vibrant DIFC community and its latest happenings, please check our Insights page.

MS Insights

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The Countdown Starts for the Second Edition of Dubai Fintech Summit 2024

The Countdown Starts for the Second Edition of Dubai Fintech Summit 2024

The global community convenes in Dubai to pioneer the future of Fintech, drawing participants, speakers, exhibitors, policymakers, and business innovators for the second edition of Dubai Fintech Summit 2024. Under the esteemed patronage of His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, First Deputy Ruler of Dubai, Deputy Prime Minister, and Minister of Finance of the UAE, as well as President of DIFC, the event is scheduled to take place on 6-7 May at the prestigious Madinat Jumeirah.

The FinTech Summit is a key component of Dubai’s ambitious D33 agenda, striving to make the city a leader in global finance by 2033, while encouraging collaboration and innovation. Over the past two decades, the Dubai International Financial Centre (DIFC) has really stepped up, turning Dubai into a powerhouse in finance for the Middle East, Africa, and South Asia (MEASA) region. The DIFC has outdone itself, going above and beyond what anyone expected. Its impact has been enormous, firmly establishing Dubai’s spot in the global financial game.

Discover, Connect, and Innovate: Experience the Benefits of Dubai Fintech Summit

At the Dubai FinTech Summit, it’s all about bringing startups, investors, and industry leaders under one roof to tap into the booming FinTech scene, both locally and globally. This year the focus is on transformative forces reshaping the future of finance: Finance Renaissance, Eco-finance and Impact, Investment Vanguard, Regulatory Frameworks, Global Financial Dynamics, and FinTech 2.0.

Attendees have the opportunity to engage in insightful discussions led by experts, offering valuable insights into the latest trends and advancements in finance and technology. The summit offers learning opportunities through workshops, panels, and keynote sessions, empowering to enhance the expertise in finance and technology. It is the best platform for startups to find potential investment opportunities, including promising ventures and innovative projects shaping the future of finance. Also, an exceptional opportunity to present your company, products, or services to a global audience, boosting the visibility and exposure in the finance and technology sectors.

Gathering of local and global leaders shaping the future of finance

One of the highlights of the summit includes the insightful panel discussion and fireside chats featuring over 20 esteemed governors of financial institutions, alongside prominent industry figures. H.E. Essa Kazim, Governor, DIFC, UAE; H.E. Dr. Philmnisi, Governor, Central Bank of Eswatini; H.E. Cheaserey, Governor National Bank of Cambodia; H.E. Martin Galstyan, Governor, Central Bank of Armenia; H.E. John Rwangombwa, Governor, National Bank of Rwanda; H.E. Prof. Edward Scicluna, Governor, Central Bank of Malta will participate in discussions during the two-day event. Adena T. Friedman, Chair & CEO of Nasdaq Inc; Nic Dreckman, CEO of Bank Julius Baer & Co.; Yie-Hsin Hung, President & CEO of State Street global advisors and Jim Demare, President global markets at Bank of America, along with many other global industry leaders will also be participating in the various sessions planned for the Summit.

The notable local speakers include H.E. Abdullah bin Touq Al Marri, Cabinet Member & UAE Minister of Economy; H.E. Helal Saeed Al Marri, Director General, Department of Economy and Tourism, Dubai; H.E. Salem Humaid Al Marri, Director General, Mohammed Bin Rashid Space Centre, UAE; and H.E. Faisal Belhoul, Vice Chairman of the Dubai Chamber, Chairman of J&F Holding. Their expertise will enrich the discussion and add insights into the future of finance and technology.

For further insights into the Dubai Fintech Summit, explore.

Click & Explore

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Trends and tactics for the successful M&A in 2024

Trends and tactics for the successful M&A in 2024

Mergers and acquisitions (M&A) activity across the Middle East region is experiencing a surge, due to the growing economic diversification and expansion of non-oil sectors. This momentum is further fuelled by increasing private sector involvement and the vibrant performance of capital markets. Strong economic fundamentals, supportive business regulations, and the government’s broader transformation agenda are all contributing factors increasing the prospects for dealmaking in the region. Moreover, the influence of global megatrends like technological disruption and climate change is evident, prompting investments in areas such as energy transition and digital transformation. In 2024, dealmakers are advised to prioritize the reinvention of business models, concentrate on talent acquisition, and maintain agility in navigating evolving market dynamics.

Among several factors contributing to the successful M&A, efforts put into a thorough due diligence process are vital for the success of a deal this year. A deep and thorough due diligence process can uncover hidden risks, identify growth opportunities, and pave the way for a successful transaction. Investing time and effort into due diligence is an investment in the future success of the deal and in the long-term health of the combined entity.

So, what factors require attention during the due diligence process?

The Importance of Focus in Due Diligence

One of the first areas where due diligence can go astray is the failure to focus on key issues. Time constraints are always a challenge, but rushing through without clarifying the rationale for the deal and sources of expected value can lead to wasted efforts. Here are some key points to consider:

  • Clarify the Rationale: Understand why the deal is happening and what value it is expected to bring. This determines the hypotheses to test and prevents wasting time on irrelevant data.
  • Use Standardized Processes: Standardize methodologies, formats, and project management tools. This keeps the process focused and ensures a higher level of analysis.
  • Share Information: Adequate sharing of information among all diligence teams is crucial. Regular updates help identify deal-breaker issues early and allocate resources effectively.
  • Define End Points: Rigorously define when to move on from an issue. Knowing when to report, check off, or investigate further is part of staying focused.

Identifying Opportunities and Risks

Due diligence should not just be an audit; it’s an opportunity to identify new avenues for growth and mitigate risks. Even when a deal seems imminent, there’s still room to delve deeper:

  • Stress Test Assumptions: Quickly test management’s key assumptions about the business. This may reveal new growth opportunities or areas for strategic refocus.
  • Interview Stakeholders: Talk to the target company’s management, customers, and competitors. This provides a deeper understanding of value drivers, risks, and market dynamics.
  • Validate Business Plan: By validating assumptions early, due diligence aids long-term management stewardship.

Allocating Adequate Resources

Without the right people and resources, even the most thorough due diligence process can falter. Here’s how to ensure you have the right team:

  • Expertise Matters: Choose team members with the right expertise, including managers from affected functional areas.
  • Time Matters: Give the team as much time as possible. Avoid being trapped by artificial deadlines that can compromise the quality of the process.
  • Support the Team: Provide the necessary resources—space, equipment, software, staff, and data access—to ensure they can focus on the task.

To enable these actions, it’s important to gather sufficient data during due diligence. Let’s explore the information that needs to be collected in the due diligence process.

Information to gather for thorough Due Diligence

A successful due diligence process requires gathering a range of information to paint a complete picture of the target company:

  1. Financial Information: Revenue, expenses, profit margins, debt, and cash flow.
  2. Company Information: Organizational structure, history, culture, and leadership.
  3. Product Information: Details about products or services, market share, and differentiation.
  4. Customer Information: Key clients, contracts, and customer satisfaction.
  5. Employee Information: Workforce size, skills, turnover rates, and culture.
  6. Legalities: Pending litigation, regulatory compliance, and legal risks.
  7. Intellectual Property: Patents, trademarks, copyrights, and licensing agreements.
  8. Physical Assets: Real estate, equipment, and inventory.
  9. Miscellaneous: Health and safety notices, hazardous substances, new product development plans, and associated risks.

How to enhance your due diligence process?

Fast Navigation: AI-driven tools and sentiment analysis help surface nuanced insights quickly.

Instant Insights: Generative AI tools provide instant insights from expert transcripts and documents.

User-Friendly Interface: Real-time alerts, custom search filters, and timestamped audio make research efficient.

Smart Search: Browse by various parameters to discover nuanced insights for a comprehensive understanding.

Enterprise Intelligence: Secure searches across proprietary internal data and external documents by AI.

MS at every step of the way during your M&A Due diligence

Our team of professionals specializes in comprehensive due diligence services, providing essential insights for informed decision-making. Committed to excellence and with a profound understanding of the unique UAE business environment, MS is a trusted partner, enabling successful M&A transactions by mitigating risks and seizing opportunities. Elevate your business with successful M&A transactions through MS.

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DIFC’s Family Arrangements Regulations with Fresh Opportunities for Family Businesses

The business landscape in the United Arab Emirates (UAE) is witnessing a profound transformation with the enactment of the DIFC Family Arrangements Regulations. This regulatory evolution, effective from January 31, 2023, marked a decisive shift from the Single-Family Office (SFO) regime of Dubai International Financial Centre (DIFC), aligning seamlessly with the recently introduced UAE Family Business Law.

The Regulations replace the prior DIFC Single Family Office system, which underwent several rounds of consultation since its inception. This change aims to meet the requirements of an increasing number of local and global family enterprises seeking to set up operations in the DIFC. The Regulations follow the recent enactment of UAE Decree-Law No. 37 of 2022 (UAE Family Business Law), which applies to all regions of the UAE, including the DIFC, as long as it does not contradict the legal provisions of that particular jurisdiction.

Let’s dive into elements of the DIFC Family Arrangements Regulation.

Simplified Registration Process:

Noteworthy is the simplification of the registration process for this. Family Offices are no longer bound to register as Designated Non-Financial Businesses or Professions (DNFBP) with the Dubai Financial Services Authority (DFSA). However, it is nuanced for multifamily offices, necessitating DFSA authorization and licensing for those engaging in financial services for multiple families.

Certification and Accreditation Programs:

Recognizing the unique needs of family businesses, the DIFC introduces certification and accreditation programs. These programs are designed to fortify the support system for family businesses and their advisors, aligning with the overarching goals of the UAE Family Business Law.

Flexibility for Single Families:

The regulations extend a degree of flexibility for Single Families, allowing Family Entities or Family Offices to operate beyond the DIFC’s jurisdiction. This flexibility is contingent upon demonstrating a substantial presence in the UAE and appointing a Corporate Service Provider as a registered agent in the DIFC.

Confidentiality at the Forefront:

The DIFC maintains a special register of Family Businesses, offering a private repository for sensitive information, shielding it from public disclosure. This move underscores a commitment to safeguarding the proprietary details of family businesses with the utmost confidentiality.

Licensing Requirements and Minimum Net Asset:

To be licensed as a Family Office, entities must meet specific criteria. Submission of relevant documentation and maintaining a minimum net asset requirement of USD 50 million are central to the licensing process. The assessment of net assets can be determined through fair market value or, alternatively, a book value assessment.

Alternative Dispute Resolution (ADR):

The regulations lay a strong foundation for Alternative Dispute Resolution (ADR) within Family Structures. This provision allows for arbitration to resolve disputes, aligning with the UAE Family Business Law’s emphasis on establishing committees in each Emirate to oversee family business disputes.

The DIFC Family Arrangements Regulations emerge not merely as a legal framework but as a commitment by the DIFC to nurture the growth and success of family businesses in the region. As the DIFC launches the Global Family Business and Private Family Wealth Centre, it underscores its dedication to providing unparalleled support for family businesses, ultra-high net worth individuals, and private wealth offices operating within its jurisdiction. These regulations set the stage for a more transparent, flexible, and supportive environment, reflecting the evolving needs of family businesses in the dynamic landscape of the DIFC.

To explore more about the vibrant DIFC community and its latest happenings, please check our insights page.

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Al Reem Island Businesses: Assess your Business Activity and Category for ADGM License Advancement

Al Reem Island Businesses: Assess your Business Activity and Category for ADGM License Advancement

Establishing and operating a business in Al Reem Island involves navigating through various categories and licensing requirements. As the transition to ADGM is ongoing, knowing your business category and the pre-application steps is crucial. Simplifying this process ensures compliance and sets the stage for smooth growth and success in the vibrant Al Reem Island business scene. Plus, it paves the way for an easy license conversion process before the deadline, ensuring a seamless transition to ADGM.

The Activities are classified into 3 categories by the ADGM authorities:

  • FINANCIAL – CATEGORY A
  • NON-FINANCIAL – CATEGORY B
  • RETAIL – CATEGORY C

i)Category A: Financial Businesses

Financial businesses fall under Category A and are required to obtain an Investment Promotion Approval (IPA) from the Financial Services Regulatory Authority (FSRA) of ADGM before proceeding with the commercial license registration. The FSRA oversees financial activities and ensures compliance with regulatory standards. For more information and contact details, applicants can refer to the FSRA’s official resources and rulebook.

ii)Category B: Non-Financial Businesses

Non-financial businesses, categorized under Category B, contain a range of activities subject to additional regulations and license conditions, particularly Controlled Activities. One sub-category within this group is the Designated Non-Financial Businesses and Professions (DNFBPs), which includes:

  1. Real estate agencies
  2. Dealers in precious metals or stones
  3. High-value item dealers
  4. Accounting, audit, insolvency, or taxation consulting firms
  5. Law firms, Notary firms
  6. Company Service Providers (CSPs)

Each sub-category from (a to f) has specific requirements and may require the appointment of a Money Laundering Reporting Officer (MLRO) and adherence to Anti-Money Laundering (AML) rules.

Additional Criteria for DNFBPs Under Sub-Categories (d to f)

  • Audit firms:

They need to comply with the ADGM audit regime.

  • Law firms:
  1. Be a registered company or a branch/subsidiary of an existing legal entity.
  2. Operate for at least 8 years.
  3. Maintain at least two offices, either in different jurisdictions or within the same country.
  4. Each managing partner must have a minimum of 10 years of post-qualification experience.
  5. Employ at least 8 partners and 25 qualified legal professionals.
  6. Possess professional indemnity insurance covering activities in Al Reem Island upon registration.
  • CSPs:

Although currently under moratorium until June 30, 2024, CSPs facilitate business incorporation and serve as the main contact for ADGM. Eligible entities may explore the dual licensing regime, enabling them to operate in mainland Abu Dhabi without physical office presence, subject to regulatory requirements.

iii)Category C: Retail Businesses

Retail businesses fall under Category C and operate in the retail sector. These businesses may need to adhere to general commercial licensing regulations and any specific requirements for retail operations in Al Reem Island.

Dual Licensing

Additionally, Al Reem Island businesses have the opportunity for dual licensing, allowing eligible entities holding ADGM commercial licenses to operate in mainland Abu Dhabi without needing a physical presence on the mainland. This arrangement aims to promote business activity between ADGM and mainland Abu Dhabi, enhancing competitiveness in the region.

However, it’s essential to ensure compliance with both ADGM regulations and those imposed by mainland authorities, such as the UAE Central Bank or Securities and Commodities Authority. Depending on your business activities, you may need further licenses from onshore authorities.

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The Future of Healthcare M&A in 2024: Opportunities and Challenges

The Future of Healthcare M&A in 2024: Opportunities and Challenges

Mergers and Acquisitions (M&A) can reap success if it is done with the proper planning and strategical execution. The obstacles that led to a downturn in the M&A market last year are gradually receding, opening up opportunities for the current year. The year 2024 promises to be a pivotal one for the healthcare and life sciences industries, particularly in the realm of M&A. Despite facing challenges such as high interest rates, regulatory scrutiny, and macroeconomic uncertainty, the healthcare sector is expected to shine in the M&A market with the wide range of possibilities awaiting.

Positive Trends Driving Healthcare M&A

Several factors contribute to the anticipated surge in healthcare M&A activity this year:

  1. Leveraging Synergies: Larger pharmaceutical companies are eyeing mid-sized biotech firms to fill gaps in their pipelines. This trend is driven by changes in industry technology and evolving patient needs, particularly in chronic illness care and long-term health management.
  2. Remote Patient Technology: Advances in remote patient technology, including patient sensors and wearable devices, are attracting investors’ attention. As preventive and proactive healthcare gains importance, the market for remote patient monitoring is expanding, offering lucrative opportunities for M&A.
  3. Rise of AI Healthcare Startups: AI healthcare startups, specializing in areas like teletherapy, administration, and drug discovery, are gaining traction. This trend is expected to fuel M&A activity as startups mature and consolidate to create more robust platforms.
  4. Shift in Funding Dynamics: Venture capital funding for digital health is gradually declining, making M&A a natural path for startups seeking growth and expansion.

Navigating Market Dynamics and Macroeconomic Challenges

While the outlook for healthcare M&A appears promising, it’s essential to consider market dynamics and macroeconomic factors:

  1. Interest Rates and Valuation Gaps: Fluctuating interest rates and valuation gaps may influence deal-making decisions. However, pent-up demand from the first half of 2023 could drive a return of deal activity in 2024.
  2. Regulatory Landscape: New federal regulations introduced by the US government may impact deal timelines and requirements. Companies should stay agile and adapt to regulatory changes to capitalize on opportunities.

Emerging Trends and Opportunities in Healthcare M&A

Several emerging trends and opportunities are shaping the landscape of healthcare M&A:

  1. Digital Health Innovation: Telehealth, health tech, and analytics companies are poised to address staffing challenges and cost pressures faced by healthcare providers. M&A in this space offers opportunities to enhance operational efficiency and improve patient care.
  2. Consumer Healthcare: Demographic shifts and changing consumer preferences are driving demand for consumer health products. Companies specializing in consumer health areas, such as OTC medicine and supplements, remain attractive acquisition targets in 2024.

Strategies for Success in Healthcare M&A

To capitalize on the opportunities presented by healthcare M&A in 2024, companies should consider the following strategies:

  1. Maintain a Robust Deal Pipeline: Continuously revise target lists and deal models in response to changing market dynamics and emerging technologies.
  2. Invest in Disruptive Technology:  Follow emerging technologies, such as generative AI, to stay ahead of competitors and drive innovation within the organization.
  3. Anticipate Competitors’ Moves: Stay informed about competitors’ strategies and anticipate market shifts to position the company for success in M&A.
  4. Focus on Growth Sectors: Invest in subsectors demonstrating growth potential, such as digital health, AI-based technologies, and remote patient monitoring.
  5. Navigate Regulatory Challenges: Consider interregional M&A deals as a strategy to navigate regulatory changes and mitigate risks associated with new regulations.

Focus on M&A healthcare with MS 

As the future of healthcare in M&A is opening the door of opportunities, it is always better to have a trusted partner to make your M&A journey seamless. MS can help you with this. Our expertise ensures that you have the insights and guidance needed to tackle the complexities of business valuation, allowing you to focus on the bigger picture – your business’s success. Our suite of M&A services in the UAE is designed to ensure the success of your business transactions. From thorough due diligence to seamless integration, our dedicated team is poised to deliver outcomes that surpass expectations, driving your business towards enhanced growth and prosperity.

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DIFC Tech Innovation License in Dubai: A step-by-step guide on the stages and requirements

DIFC Tech Innovation License in Dubai: A step-by-step guide on the stages and requirements

The Dubai International Financial Centre (DIFC) has emerged as a leading hub for technology and innovation in the region, attracting startups and established businesses alike. With a 20-year track record of facilitating trade and investment, the DIFC Innovation License acts as a platform for technology firms spanning various sectors, providing access to the latest advancements in technology across the MEASA region. Offering a subsidized fee structure, the DIFC Innovation License is a Commercial License accessible to technology and innovation firms of all stages, fostering growth opportunities. It specifically targets firms looking to pioneer or experiment with new and innovative products.

If you’re considering establishing your tech venture in the DIFC, understanding the license application process is crucial. In this blog, we’ll walk you through the stages and requirements for obtaining a DIFC Tech Innovation License.

Stages of obtaining DIFC Tech Innovation License in Dubai

If your tech activity falls under the list of activities allowed for the DIFC Tech Innovation License, you may initiate the application process to obtain an In-Principal Approval. Upon receiving this approval, you can proceed with registering your technology entity within the DIFC.

There are certain stages for applying for the In-Principle Approval.

Stage I – Submit for In-Principal Approval

Step 1:

Initial Application:  The journey begins with filling out and submitting your online Initial Approval application, which will be sent via email. Make sure to select the option for Digital Passport Verification to advance the process.

Step 2:

Review Process Your application: In this step, you will undergo a thorough review for Initial Approval by the authorities.

Step 3:

In-Principal Approval: Upon successful review, you’ll obtain the In-Principal Approval, marking an important milestone in the process.

Stage II: Register the Legal Entity

Step 1:

Document Submission: Submit the necessary documents and complete the required payments. Payment methods include credit/debit card, bank transfer, or cash.

Step 2:

 Incorporation Complete: Once the submission is processed, the incorporation of your legal entity will be completed. You’ll receive all corporate documents automatically via email.

Step 3:

Annual Renewal: Ensure to renew your license annually as per the terms, depending on your chosen payment method.

Now let’s look at the specific information that should be included in the application.

Application Form – Key Information Required

  1. Business Activities: Provide detailed information about your technology and innovation, including a value proposition, revenue model, and product details. If setting up a Tech R&D entity, a signed undertaking letter confirming no financial activities will be conducted is necessary.
  2. Entity Background: Furnish a summary of the entity being established, ownership structure, and biographies of shareholders/directors/UBOs.
  3. Source of Income: Detail the funding sources for the DIFC entity, financial background of shareholders, and how the wealth was accumulated. Supporting documents such as bank statements or investor agreements may be required.
  4. Documents Required: Ensure to provide necessary documents such as passport copies of shareholders/directors/UBOs, bank statements, audited financial statements (if applicable), and an attested Certificate of Incorporation if the entity will be owned by a parent entity.

If you get an In-Principle Approval after the application, the next step is to register your entity in the DIFC.

Registering your Entity in the DIFC – Guidelines

Once you receive In-Principle Approval, follow these steps to complete the registration process:

  1. Log in to the Client Portal to fill out the application for Registration with DIFC.
  2. Submit certified passport copies of Shareholders/Directors & Company Secretary.
  3. Provide a Board Resolution for incorporation if the entity has a shareholder body corporate.
  4. Apply and pay for Co-working Space (Flexible desk) if required.
  5. Submit your final application on the DIFC portal and complete the DocuSign of the Articles sent by email.

Choose MS for DIFC Tech Innovation Company Formation
Partnering with MS at DIFC simplifies the process of obtaining an innovation license. With expertise in local regulations and connections within DIFC, we accelerate the licensing procedure, allowing businesses to focus on innovation. MS provides essential assistance to tech startups aiming for the DIFC Innovation License, guiding them through licensing requirements with personalized advisory services. We foster collaboration and networking opportunities within the startup community, contributing to the success of ambitious entrepreneurs in Dubai’s tech industry.

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Deadline Approaching: Ensure compliance with crucial DFSA & FSRA filings by April 30th, 2024

Deadline Approaching: Ensure compliance with crucial FSRA & DFSA filings by April 30th, 2024

The Abu Dhabi Global Market’s and Dubai International Financial Centre’s vision for a fair, efficient, and transparent marketplace is always advocated by the Financial Services Regulatory Authority (FSRA) and Dubai Financial Services Authority (DFSA) by upholding compliance standards and making a progressive global financial hub. The regulatory requirements mandated by these bodies play a major role in bringing the registered entities in line with the standards of these international financial centres.

Both authorities have an upcoming deadline: April 30th, 2024, for several crucial filings this year. It is imperative for businesses to ensure they fulfill these obligations promptly to maintain compliance and avoid potential penalties.

What are DFSA & FSRA?

FSRA and DFSA stand as significant pillars in the financial landscape, each playing a crucial role in regulating and safeguarding the financial services of ADGM and DIFC.

The Dubai Financial Services Authority (DFSA) operates as an independent regulatory body within the Dubai International Financial Centre (DIFC). Its jurisdiction spans a wide array of financial activities including asset management, banking, securities, insurance, and more. Moreover, it diligently enforces anti-money laundering (AML) and counter-terrorist financing (CTF) measures, ensuring the integrity and security of the financial environment within the DIFC.

On the other hand, the Financial Services Regulatory Authority (FSRA) holds sway in the Abu Dhabi Global Market (ADGM). This regulatory body is dedicated to upholding internationally recognized standards and best practices, ensuring that financial entities operate on a level-playing field while prioritizing the interests of customers and investors.

What sets the FSRA apart is its adaptive regulatory framework. It keeps pace with evolving global standards and market innovations, maintaining a keen eye on international standard-setting bodies. FSRA actively engages with stakeholders through public consultations, fostering transparency and inclusivity in its regulatory processes.

We have made the list of filings due on April 30th, 2024, that you must follow and comply with.

  • Regulatory Returns Auditor’s Report – FSRA & DFSA Regulated Entities
  • Financial Statements and Auditor’s Report – FSRA & DFSA Regulated Entities
  • Internal Risk Assessment Process (IRAP) – FSRA & DFSA Regulated Entities
  • Internal Capital Adequacy Assessment Process (ICAAP) – FSRA & DFSA Regulated Entities
  • Client Money Auditor’s Report – FSRA & DFSA Regulated Entities
  • Safe Custody Auditor’s Report – FSRA & DFSA Regulated Entities
  • Annual Report on Controllers – FSRA & DFSA Regulated Entities
  • Public Listed Company Auditor’s Report – FSRA & DFSA Regulated Entities
  • Quarterly EPRS Returns – FSRA & DFSA Regulated Entities
  • AML Return – FSRA & DFSA Regulated Entities & DNFPB Entities
  • ADGM FATCA & CRS SCF – For all ADGM entities

MS as your compliance partner in both ADGM and DIFC

Our team comprises finance, compliance and legal professionals equipped with the expertise, competence, and up-to-date regulatory knowledge necessary to support your finance function. MS is committed to ensuring absolute compliance with ADGM and DIFC’S regulatory requirements without fail. Take the first step towards planning your crucial filings for the month ahead with our seamless plan and proactive guidance.

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Marking milestones: DIFC celebrating 20 years of success with 20 Days of Finance

Marking milestones: DIFC celebrating 20 years of success with 20 Days of Finance

“I once read an article in a foreign newspaper saying: luck smiles back at Dubai. I respond: when they want to diminish your achievements, they attribute them to luck.”

These words from His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, the first Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance of the UAE, and President of DIFC, encapsulate the essence of Dubai’s remarkable journey of achievements. Dubai, a city that never settles for anything less than the first place, has evolved into a hub of growth, innovation, and prosperity, earning its status as the epitome of a dream city. Dubai’s ascent to becoming a global hub is attributed to the dedication and collective efforts of numerous individuals and groups within the region.

The Dubai International Financial Centre (DIFC) has been instrumental in shaping Dubai into what it is today, emerging as the eminent global financial hub for the Middle East, Africa, and South Asia (MEASA) region. Its two-decade reign has surpassed all projections, underscoring its pivotal role in solidifying Dubai’s position within the global financial services landscape. Adding more colour to this success story, DIFC has announced an exciting series of finance events and activities spanning 20 days, in celebration of the Centre’s 20th Anniversary. The 20 Days of Finance is primarily anchored around the 2nd edition of the Dubai FinTech Summit held under the patronage of the President.

DIFC: 20 Days of Finance

From April 29th to May 29th, attendees will have the chance to participate in a variety of activities including events, seminars, workshops, networking sessions, and special celebrations. The ‘20 Days of Finance’ series by DIFC aims to unite leaders in the industry, policymakers, investors, and entrepreneurs to mark DIFC’s twenty years of prominence in the global financial sector.  

The 20-day lineup of events will commence with the Dubai World Insurance Congress on April 29th to 30th at Atlantis, The Palm. Following that, the 2nd edition of the Dubai FinTech Summit will take place on May 6th to 7th at the Madinat Jumeirah, succeeded by the inaugural HFM Summit on May 15th at The Conference Centre, DIFC, which will unite the hedge fund sector in collaboration with With Intelligence. Additionally, the Institute of International Finance (IIF) will be partaking in DIFC’s 20 Days of Finance, marking their 10th anniversary in the Centre and DIFC’s 20th anniversary with the IIF MENA CRO Forum on May 21st.

Throughout the month, activities will be organized for DIFC clients in the corporate and investment banking, as well as wealth management sectors. In April, DIFC will also serve as a platinum partner for the AIM Summit in London, the leading event for professionals in alternative investments.

Global excellence through financial innovation

The DIFC has been instrumental in fostering economic growth and innovation in the region. It has attracted top-tier institutions and talent from across the globe. Aligned with DIFC’s Strategy 2030 and Dubai’s Economy Agenda (D33), which aims to establish Dubai as a premier business hub globally, DIFC encourages financial institutions to partake in the ‘20 Days of Finance’ by organizing their own events across the city. This initiative aims to draw high-profile attendees and showcase the city’s vibrant thought leadership and progressive governance. The ‘20 Days of Finance’ initiative underscores DIFC’s dedication to excellence and innovation in the financial sector. By spearheading innovation and digital transformation, DIFC facilitates the success of businesses not only in Dubai but also on a global scale.

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How ADGM is empowering Tech Startups in Abu Dhabi to rise and shine

How ADGM is empowering Tech Startups in Abu Dhabi to rise and shine

Abu Dhabi’s transformation into a global economic powerhouse is nothing short of extraordinary. Reflecting this success, Abu Dhabi Global Market (ADGM) has emerged as an epitome of growth and progress in the financial world. In just eight years, ADGM has become one of the world’s largest financial districts and the fastest-growing international financial center in the region, securing its place as a Falcon economy. The journey of ADGM is a testament to the power of vision and unwavering commitment. It underscores the remarkable results that come from consistent effort, persistence, and alignment with economic goals. As ADGM declared 2023 as a “year of success” for the international financial center of the UAE, the role of tech startups in building ADGM’s ecosystem cannot be overstated.

Hub71: The launchpad of tech startups in ADGM

Hub71, a vibrant tech ecosystem based in ADGM, offers global startups access to capital, market opportunities, longer-term visas, and a highly skilled talent pool. ADGM provides competitive tech startup licenses that enable entrepreneurs to grow and scale their businesses within an award-winning regulatory framework. Abu Dhabi’s strategic advantages make it an ideal launchpad for tech startups. With a multi-billion Dirham commitment to programs like Ghadan 21, the government is actively supporting innovation, committing AED 1 billion to help startups and entrepreneurs build a technology-enabled future.

Here’s why tech startups should consider ADGM as their hub:

  1. Cost-Effectiveness: ADGM’s Tech Startup License is incentivized for up to three years, providing a favorable environment for startups to establish themselves.
  2. Visa Benefits: Entrepreneurs can avail 3-year and 5-year visas, facilitating their stay and operations in Abu Dhabi.
  3. Sector Agnosticism: The ADGM Tech Startup License is open to startups across all sectors, fostering diversity and innovation.
  4. Access to Ecosystem: Through Hub71 and ADGM’s innovation cluster, startups benefit from a strong network of government entities, corporates, funders, and industry partners.
  5. Access to Investors: ADGM hosts a growing community of venture capital firms, banks, financiers, and investors, providing capital for growth.
  6. Rule of Law: ADGM offers a robust legal framework based on English common law, ensuring transparency, fairness, and enforceability of contracts.

ADGM Tech Startup License

The ADGM Tech Startup License offers an expedited setup process for entrepreneurs in the UAE, with two distinct stages: Seed and Emergent. Notably, this license is for innovative tech startups, excluding technology service providers.

Eligible applicants include local, regional, and international startups with innovative tech business models that leverage technology to solve customer challenges and address specific market needs. These startups should demonstrate potential for regional or global scalability and support sustainable economic development.

Benefits of the Tech Startup Commercial License in ADGM are comprehensive, including:

  • An operational commercial license irrespective of sector.
  • Competitive annual license fees, with USD 1,000 for the seed stage (up to two years) and USD 4,300 for the emergent stage (up to three years) within the first five years of operation in ADGM
  • Provision of three visas for every desk space.
  • Eligibility to apply for dual license recognition with the Abu Dhabi Department of Economic Development, subject to meeting criteria.
  • Access to potential funding and equity-free subsidies through the Hub71 Incentive Program.
  • Potential access to the Hub71 community, including accelerator programs like Plug & Play.
  • Access to a network of local and international entrepreneurial mentors and experts.
  • The assurance of an independent jurisdiction under an internationally recognized English common law framework.

Furthermore, eligibility for the incentivized license is determined upon application, with a fixed duration. For instance, approval for the seed stage incentivized license grants two years in the seed stage, automatically transitioning into the emergent stage in the third year of operations, irrespective of full-time employee count.

 Applying for a tech startup license in ADGM is seamless. Here is how to do that:

Application Process for Obtaining a Tech Startup License in ADGM

Submission: To obtain the ADGM Tech Startup License, startups can apply online. Along with the application, a business plan, office space lease, initial annual license fee, as well as other necessary documentation mentioned by ADGM is required.

Review: ADGM will assess the application and notify applicants via email if additional information is needed.

Approval: Upon completion of the evaluation, applicants will receive an email informing them of the status of their application.

Incorporation and License Issuance:  Once approved, the registration and incorporation process are handled by the ADGM Registrar and the license is issued. Applicants will receive email confirmation of the license issuance and can proceed with their operations.

Why MS in ADGM?

With extensive knowledge of local regulations and established connections within ADGM, we can guide you. Through personalized advisory services, we guide startups through licensing requirements, fostering collaboration and networking opportunities within Abu Dhabi’s tech industry. This support contributes significantly to the success of ambitious entrepreneurs in the startup community.

Disclaimer: 

Registered in Abu Dhabi Global Market (Registered No. 000007218),
We are not an ADGM Registered Corporate Service Provider.

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