ADGM’s funds regime consultation signals a new era

The Financial Services Regulatory Authority has proposed significant enhancements to the Abu Dhabi Global Market (ADGM) funds regime that marks a decisive step forward in regulatory expectations for fund managers and their advisers. 

The proposed enhancements place strong emphasis on fund administration, operational substance and governance, moving these areas firmly into the regulatory spotlight. 

Consultation Paper 12/2025 was published in November and while the headlines focus on sub-threshold managers, institutional-only frameworks and new fund categories, the broader message is that the consultation reflects ADGM’s evolution into a more mature and globally aligned fund domicile. 

For fund managers, the implications encompass legal, structuring and operations, with substance, governance and risk alignment moving from background expectations to centre stage. The review aims to reflect international best practice and insights from its own regulatory experiences and to continue to support ADGM’s long-term growth as a jurisdiction of choice for funds. 

The consultation closes on 30 January 2026, and following the implementation of the Financial Services Regulatory Authority (FSRA'S) recommendations, fund managers should expect increased scrutiny across the full fund lifecycle, with particular emphasis on: 

Even where the regime proposes simplifications, such as lighter-touch requirements for certain venture capital or sub-threshold managers, the FSRA is explicit that operational infrastructure must remain proportionate, effective, and demonstrable. 

The FSRA’s proposals signal growing expectations around local presence. This includes the use of ADGM-based administrators and company service providers (CSPs), and UAE-resident directors. A reputable and established fund administrator provides the operational backbone regulators expect to see, supporting a credible, compliant and auditable operational footprint.  

Even streamlined regimes are required to meet these governance standards. Administrators typically support the key areas that regulators and investors are scrutinising - statutory record-keeping and regulatory filings, board reporting and investor communications together with AML/CTF documentation and compliance registers. Valuation process oversight and NAV controls also require support. 

With proposals allowing some smaller or institutional-only managers to access reduced authorisation thresholds, many firms will look to avoid building infrastructure internally. An experienced fund administrator provides the systems, documentation and reporting frameworks to allow such managers to operate efficiently, remain compliant, and focus resources on portfolio performance rather than operational expansion. 

As ADGM increasingly attracts private credit, green and climate transition funds, specialist administration is key. These structures generally require tailored reporting, investor disclosures and ongoing regulatory engagement – areas where experienced administrators such as Praxis, with deep ADGM expertise, can deliver. 

Fund managers either operating in or planning to launch in ADGM should treat this consultation as a signal to reassess their operating model.  

Key questions to ask: 

• Does your structure meet the FSRA’s substance and control expectations?
• Are your governance and valuation processes adequately documented and maintained?
• Can you demonstrate oversight and compliance-readiness to regulators and investors?
• Do you have the capacity to manage these responsibilities in-house?

A well-aligned fund administrator can help mitigate regulatory and operational risk while strengthening governance and compliance frameworks. 

As ADGM’s funds regime develops, the focus is shifting from minimum thresholds to ongoing capability. The consultation process may still be in motion, but the direction of travel is clear, and fund managers must be operationally prepared and able to demonstrate their readiness. 

A strategic approach to fund administration helps firms meet these expectations and supports long-term confidence from investors, regulators and boards.

As the longest-standing holder of a Fund Administrator Licence in the ADGM (2017), we have proven expertise in working closely with institutional, private equity, venture capital, family office and private clients, and providing comprehensive, high-touch support to regional and international funds.  

We partner with start-up managers through the regulatory set-up and fund formation process, while our transfer team can quickly and efficiently relocate the administration for established fund structures.