The Abu Dhabi Global Market (ADGM) has emerged as a leading international financial centre for investment and fund management in the UAE. Known for its transparent regulations and independent legal system based on English Common Law, ADGM offers a sophisticated framework for setting up investment funds, including hedge funds, qualified investor funds (QIFs), and cross-border structures.

For asset managers, family offices, and institutional investors, setting up an ADGM fund in UAE provides access to a robust ecosystem of financial services, strategic regional positioning, and a progressive regulatory environment.

Why Choose ADGM for Fund Formation?

ADGM is a preferred jurisdiction for fund managers due to its regulatory flexibility and global recognition. Key advantages include:

• Common law framework ensuring international legal certainty.
• 100% foreign ownership permitted for all fund structures.
• Tax efficiency with zero personal and corporate income tax for 50 years.
• Recognition of global fund structures, including private equity, hedge, and real estate funds.
• Regulatory credibility under the Financial Services Regulatory Authority (FSRA).

These features make ADGM a competitive choice for hedge fund structuring in UAE and foreign fund formation targeting regional and global investors.

Types of Funds Permitted in ADGM

ADGM provides multiple fund structures, each tailored to different investor categories and management strategies:

1. Public Funds – Suitable for retail investors with full regulatory oversight.
2. Exempt Funds – Targeted at professional investors with lighter compliance requirements.
3. Qualified Investor Funds (QIFs) – Designed for high-net-worth and institutional investors, allowing faster setup and operational flexibility.
4. Private Investment Funds (PIFs) – Focused on closed-ended or niche investment strategies.

Establishing a formation QIF fund in UAE enables fund managers to raise capital efficiently while maintaining compliance with FSRA standards.

Process for Setting Up an ADGM Fund

The process for setting up ADGM fund in UAE involves the following stages:

1. Choose a Legal Structure – Funds can be established as companies, limited partnerships, or cell companies.
2. Appoint a Fund Manager – Must be licensed or registered with the FSRA.
3. Prepare the Offering Memorandum – Outlining fund strategy, risks, and investor terms.
4. Submit Application to FSRA – For approval of fund and management entity.
5. Obtain Incorporation Certificate – Once regulatory approval is granted.
6. Launch and Register with ADGM Registrar – Fund becomes operational upon final registration.

Working with experienced advisors ensures that every step of ADGM fund formation adheres to regulatory and due diligence requirements.

Hedge Fund Structuring in UAE

Hedge fund structuring in UAE through ADGM allows fund managers to implement sophisticated investment strategies under a secure and internationally recognised regulatory regime.

Key considerations include:

• Determining the fund’s domicile and investor type.
• Establishing risk management and compliance systems.
• Appointing independent custodians, administrators, and auditors.
• Structuring performance and management fees in accordance with FSRA guidelines.

The ADGM framework ensures investor protection while allowing managers the flexibility to pursue global investment opportunities.

Foreign Fund Formation and Cross-Border Structuring

ADGM’s legal system enables seamless formation of foreign funds in UAE, including re-domiciliation of funds from other jurisdictions. Cross-border funds benefit from:

• Recognition of international fund structures under English law.
• Ease of registration for foreign entities and partnerships.
• Access to double taxation treaties and favourable investor terms.

This flexibility makes ADGM a hub for formation foreign fund in UAE, connecting regional investors with global markets.

Formation of Qualified Investor Funds (QIFs)

The formation of QIF funds in UAE under ADGM allows for rapid fund registration — typically within two weeks — and lower compliance costs compared to retail funds.

Features include:

• Minimum subscription of USD 500,000 per investor.
• Maximum of 50 investors per fund.
• Managed by an FSRA-approved fund manager.

QIFs are ideal for private equity, real estate, venture capital, and alternative investment strategies.

Cost of ADGM Fund Setup

The cost of setting up an ADGM fund in UAE varies depending on the fund type and management structure. On average, setup costs range between USD 20,000 and USD 50,000, covering incorporation, regulatory fees, and licensing.

Engaging a legal expert helps optimise costs while ensuring full regulatory compliance during hedge fund structuring in UAE.

How Ronin Legal Consulting Can Help?

Ronin Legal Consulting specialises in regulatory, legal, and fund setup advisory across the UAE’s leading jurisdictions, including ADGM and DIFC. Our services include:

• Fund structuring and regulatory approval.
• Licensing and documentation under FSRA.
• Cross-border and foreign fund formation.
• Ongoing compliance, audit, and governance support.

With extensive experience in financial and investment law, we provide end-to-end guidance for setting up ADGM fund in UAE efficiently and securely.

Conclusion

ADGM offers a modern and investor-friendly environment for fund establishment, providing flexibility for hedge, foreign, and QIF structures. Its globally recognised legal system, tax advantages, and regulatory transparency make it a prime destination for fund managers and institutional investors.

For expert support with legal structuring, licensing, and compliance, partner with RONIN LEGAL your trusted advisor for fund setup and incorporation in the UAE.