How has ADGM’s Al Reem Island expansion advanced in one year?
Mohammed Shafeek
Founder & Group CEO at MS and Kitaab.ai | Independent Director | Focused on Transaction Support, M&A, Corporate Services, Executive Search | Deal Scout | Family Office Advisor | Expertise in Business Exits
A year ago, #Abudhabi took the initiative to transform the ADGM into one of the world’s largest financial hubs, totalling 14.38 million sqm – a strategic evolution, marking a new chapter in creating a world-class financial hub,?increasing the size of its jurisdiction 10x.
Let us assess the entire journey.
Why did ADGM make this move?
The expansion of ADGM to Al Reem Island aims to accommodate rising demand, occupancy rates in Al Maryah Island exceeding 95%, positioning it as a global financial hub. This move enhances ADGM's ecosystem with commercial, residential, and luxury amenities, attracting corporations and talent to Abu Dhabi. It solidifies ADGM's value proposition by complementing its robust legal and regulatory framework.
How was the Transition Process?
ADGM faced the challenge of integrating Al Reem Island's business and commercial sectors within its jurisdiction to ensure a smooth transition for existing businesses.
- Collaborative Efforts: ADGM collaborated with key government stakeholders and local authorities, including ADDED, CBUAE, ADM, MoHRE, and ICP, to establish flexible measures for a seamless transition.
- Milestone 1: As of November 1, 2023, new businesses on Al Reem Island must obtain a commercial licence from ADGM,?subjecting them?to ADGM laws and regulations.
- Milestone 2: As part of Al Reem Expansion, the?incentive was offered by ADGM to Cat C applicants.
-Milestone 3: Unveiling of additional Incentive Initiatives.
- Provisional Exemption: Existing businesses on Al Reem Island can maintain their ADDED licence until December 31, 2024, after which they must fully comply with ADGM licensing requirements.
- Ongoing Inquiries: ADGM continues to address inquiries about the impact of the jurisdiction expansion, including the transition period, potential dual licensing, and whether the ADGM regulatory framework will be mandatory or optional for existing entities.
What is happening now?
- ADGM launched several initiatives, including awareness sessions and focus group meetings, to assist Al Reem Island businesses?transition?smoothly to ADGM’s jurisdiction.
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- An information centre was established in Shams Boutik, Al Reem Island, to provide comprehensive support, gather feedback, and offer registration guidance.
- On March 4, 2024, ADGM held its first community event on Al Reem Island, with over 500 business representatives and officials from ADDED and DMT participating to foster active engagement and support.
Incentive Initiative to Support Businesses
-?ADGM introduced a new incentive initiative for non-financial and retail businesses on Al Reem Island during the community event.
- Eligible businesses will be exempt from ADGM commercial licence fees until October 31, 2024, easing their transition from ADDED to ADGM.
- This initiative underscores ADGM’s commitment to facilitating the smooth integration of Al Reem Island businesses into its ecosystem, supporting sustainable local economic growth.
MS , to support the Al Reem Expansion is offering 50 Pro Bono migration assistance exclusively for qualifying retailers on Al Reem Island - an?initiative to empower and support local businesses. Over-business support; it's a testament to our belief in community strength and mutual growth.
For more details on eligibility and how to apply ??.?
This transition will create a commercial and residential shift in Al Reem Island, with a higher density of HNIs and UHNIs, foreign investment, real estate market booming etc. Handling the short-term difficulties, the Expansion is an impactful move in the long term.
What changes do you anticipate in Al Reem as part of ADGM Expansion?
#ADGM #FinancialHub #BusinessGrowth #AbuDhabi #AlReemExpansion #RRR