Abu Dhabi Tax-Free Zone To Launch Foundations
Friday, June 2, 2017
Abu Dhabi Global Market, the low-tax international financial center, is seeking feedback on its proposal to allow the formation of "foundations," a trust-like entity widely used in civil law jurisdictions.
A foundation is an incorporated entity with features of both a company and a common law trust. Foundation regimes currently exist in many international financial centers, including common law jurisdictions that have historically relied on traditional trust structures.
The proposed foundations framework is intended to complement and strengthen ADGM's extensive corporate and legal structure offerings, and will be the first of its kind in the United Arab Emirates when it goes live.
It has been designed for individuals, families, organizations, and their professional advisors seeking to efficiently manage private wealth, safeguard assets, and enhance succession planning in Abu Dhabi and abroad.
Benchmarked against other leading global jurisdictions, including Jersey and Guernsey, the proposed features of the ADGM foundations regime will protect the confidentiality of the foundation's arrangements, safeguard the founder's ability to exercise control over a foundation, and facilitate migrations from other jurisdictions to ADGM, and vice versa.
ADGM is inviting interested parties to comment on the new foundations regime, contained in Consultation Paper No. 3 of 2017, by July 5, 2017.
ADGM is an international financial center established in 2013. It offers a range of attractive benefits to firms, including exemption from taxes guaranteed for 50 years, relaxed rules on the repatriation of profits, and 100 percent foreign ownership.