The Abu Dhabi Global Market (ADGM) has introduced significant legislative amendments, effective 1 May 2026, marking one of the most substantial regulatory updates in recent years. These amendments, issued by the ADGM Registration Authority (RA), aim to strengthen regulatory clarity, align ADGM with international standards, and enhance Anti‑Money‑Laundering (AML) and Counter‑Terrorist‑Financing (CFT) safeguards.
Accordingly, existing foundations and trusts are advised to review their purpose clauses. Entities should assess whether their current structures inadvertently fall within the restricted category and consider alternative options if the intention is to pursue philanthropic or charitable objectives within ADGM.
As a result, the beneficial‑ownership regime becomes more proactive, time‑sensitive, and documentation‑intensive. Trusts and similar entities should ensure they apply a clear and defensible cascade to identify ultimate beneficial owners, maintain accurate internal registers, report any ownership or control changes within 15 days, prepare compliant beneficial‑ownership documentation and implement monitoring systems to prevent late filings.
Additionally, the ADGM Commercial Licensing Regulations (Conditions of Licence and Branch Registration) Rules 2025 have been repealed and replaced with the 2026 Rules, effective immediately. These updates affect, branch registration requirements, licensing conditions and ongoing compliance obligations for non‑financial entities.
Note: This Legal Update / Newsletter is intended for general informational purposes only and should not be construed as legal advice. It is based on laws and legal interpretations in effect as of the date of publication. Laws and regulations may change over time, and their application can vary depending on individual circumstances. Readers are strongly encouraged to seek specific legal counsel before acting on any of the information provided herein.
Restrictions on Non‑Profit Activities:
One of the most notable changes is that ADGM no longer permits the establishment of a foundation or trust whose primary purpose resembles that of a non‑profit organisation under ADGM’s AML framework. Non‑profit structures are considered higher‑risk for money‑laundering and terrorist‑financing abuse under global standards. A foundation or trust can still be created in ADGM; however, its stated purpose cannot be primarily charitable, philanthropic, religious, educational, humanitarian, or otherwise public‑benefit oriented. If the purpose falls within these categories, ADGM will not allow the structure to be registered. This aligns ADGM with FATF Recommendation 8, which highlights the vulnerability of non‑profit entities to terrorist‑financing abuse.Accordingly, existing foundations and trusts are advised to review their purpose clauses. Entities should assess whether their current structures inadvertently fall within the restricted category and consider alternative options if the intention is to pursue philanthropic or charitable objectives within ADGM.
Enhanced Beneficial Ownership Requirements for Trustees:
The amendments introduce clearer and more stringent beneficial‑ownership obligations, particularly for trustees. Trustees must now follow a more explicit cascade approach to identify ultimate beneficial owners, consistent with FATF and OECD guidance. Entities must also report any changes to beneficial ownership within 15 days, with non‑compliance potentially attracting fines of up to USD 54 million.As a result, the beneficial‑ownership regime becomes more proactive, time‑sensitive, and documentation‑intensive. Trusts and similar entities should ensure they apply a clear and defensible cascade to identify ultimate beneficial owners, maintain accurate internal registers, report any ownership or control changes within 15 days, prepare compliant beneficial‑ownership documentation and implement monitoring systems to prevent late filings.
Prohibition of Bearer Shares:
Bearer shares, where ownership belongs to whoever physically holds the certificate, have long been viewed as a major anonymity loophole that can facilitate money‑laundering, tax evasion, and other illicit activities. ADGM’s prohibition of bearer shares ensures that all share ownership is now traceable and recorded, closing a significant transparency gap. This aligns ADGM with global AML/CFT standards and prevents companies from issuing untraceable ownership instruments.Other Regulatory Updates:
ADGM has also updated several filing deadlines within the Companies Regulations and related frameworks to improve operational certainty, filing discipline, and clarity for registered entities.Additionally, the ADGM Commercial Licensing Regulations (Conditions of Licence and Branch Registration) Rules 2025 have been repealed and replaced with the 2026 Rules, effective immediately. These updates affect, branch registration requirements, licensing conditions and ongoing compliance obligations for non‑financial entities.
Conclusion:
As we know, in February 2024, FATF removed the UAE from its increased monitoring list (grey list). The UAE has since strengthened its federal AML framework through Federal Decree‑Law No. 10 of 2025. Against this backdrop, ADGM’s 2026 reforms represent a deliberate continuation of the national strategy to reinforce regulatory robustness, elevate transparency standards, and demonstrate sustained commitment to international compliance expectations. Together, these measures position the UAE, and ADGM in particular, as a jurisdiction aligned with global best practice and focused on long‑term financial integrity.Note: This Legal Update / Newsletter is intended for general informational purposes only and should not be construed as legal advice. It is based on laws and legal interpretations in effect as of the date of publication. Laws and regulations may change over time, and their application can vary depending on individual circumstances. Readers are strongly encouraged to seek specific legal counsel before acting on any of the information provided herein.