Our Team

STA's Team of Lawyers in Abu Dhabi, Bahrain, Doha, UAE, Luxembourg, Moscow, RAK, Sharjah, and Singapore. Find a Lawyer. ..

Read more information

Abu Dhabi Global Market Private Financing Platform Consultation

Abu Dhabi Global Market Private Financing Platform Consultation

 

Introduction

Lawyers in ADGMThe Abu Dhabi Global Market (ADGM) is one of the newer free zones within the UAE. It is also one of only two financial free zones across the entire country, with the other being the DIFC in Dubai. The free zone is one of the most independent within the UAE as it produces almost all of the legislation and regulations in the area. Most free zones have their regulatory authorities and rules, though very few are to the scale of the ADGM and the DIFC.

Private Financing Platforms (PFP) are entities whose business it is to provide privately owned entities with access to financing through private institutional investors. They are therefore highly relevant within the financing business world. Some of the key activities they may perform and provide services to include the following:

  1. Business to Business Lending;
  2. Equity Crowdfunding;
  3. Invoice Financing; and
  4. Private Placement.

With the ADGM being such a significant part of the UAEs financial market, and the PFPs being as vital as they are, it should come as no surprise that there have been recent developments on the issue.

Overview of the ADGM Consultation

Financial Lawyers in Abu DHabiThe Financial Services Regulatory Authority (FSRA) is one of the regulatory bodies within the ADGM free zone. Recently, they released a consultation paper which outlined and proposed the regulatory framework for the operations of PFPs.

One of the key takeaways is the proposed addition of a new form of license activity; this would relate specifically to PFPs (which carry out their business online) which allow investment based or loan based PFP transactions.

The regulations will allow for a higher level of confidence from clients of these PFPs as they will now require licenses and also, the heightened regulation will allow for more excellent knowledge of the market by the FSRA and more significant levels of control. It will open up a more extensive range of asset transfer, financing and securitization options to entities within the ADGM.