The sector in brief
Business centres operating in ADGM are designated non-financial businesses under the ADGM AML framework. They must carry out customer due diligence on clients who use their address or workspace services and report suspicious activity.
Providing a registered office or mail address to a company with no real activity can make that company appear credible. Supervisors expect business centres to understand who is behind every client and what the client actually does.
The ADGM Registration Authority supervises business centres and expects them to apply the AML framework proportionate to the risk their business model presents.
Where the risk sits
Shell companies using a legitimate address
A dormant company with a registered address at a business centre can appear to have substance it does not have.
Multiple companies under one client
A single client operating several companies from the same address makes it harder to understand the purpose of each.
Undisclosed beneficial owners
Where a company is controlled by someone who does not appear in its registration, the business centre may be the only point at which the real owner can be identified.
High-risk jurisdictions
Clients with links to sanctioned countries or territories listed as high-risk require enhanced due diligence.
Who supervises you
Business centres operating in Abu Dhabi Global Market are supervised by the ADGM Registration Authority for AML purposes.
The supervisor decides the detailed rules for your licence category, so always read its current guidance alongside this page.
What supervisors expect
- An AML policy and risk assessment specific to business centre services in ADGM.
- Customer due diligence on every client, including identification and verification of beneficial owners.
- Ongoing monitoring to detect changes in client status or unusual activity.
- Sanctions and PEP screening at onboarding and on an ongoing basis.
- Reporting through the ADGM Financial Intelligence Unit and record keeping for the required period.
- Staff training proportionate to their exposure to client-facing risk.
Red flags to watch
- A client who cannot explain what the company does or who ultimately controls it.
- Multiple companies registered at the same address with overlapping ownership.
- A client who requests mail handling for large volumes of financial correspondence.
- Rapid changes in the named directors or shareholders shortly after incorporation.
- Links to jurisdictions subject to ADGM or FATF advisories.
A worked example
A client requests an address for several newly formed companies
A client asks for registered addresses for three companies incorporated in the same week, each with a different named director. The stated business purpose is vague. The business centre asks for details of the beneficial owner behind all three, the purpose of each company and the nature of expected activity. If the client cannot provide clear answers, the business centre should decline and have the compliance officer consider a report.
How Adventant helps
Questions answered
Are business centres in ADGM required to register as DNFBPs?
Yes. Business centres in ADGM that provide registered office or address services are designated non-financial businesses and must comply with the ADGM AML framework.
What due diligence is required before providing an address?
At minimum: identification and verification of the client and its beneficial owners, understanding the purpose of the company and its expected activity, and confirmation that the client is not subject to sanctions.
Do we need to monitor ongoing use of the address?
Yes. You should monitor for signs of unusual activity, changes in ownership and any information that conflicts with what the client told you at onboarding.