Technically there is no such thing as an "ADGM Trust". Instead, a trust deed that creates a trust arrangement can be drafted such that ADGM law governs the trust. This does not mean that the trust is incorporated or registered in ADGM as these concepts don't exist. It means that ADGM law is selected to determine the substantive trust-law rights and obligations.
ADGM guidance describes express trusts under ADGM law as private legal arrangements. A trust may arise through a transfer of property to a Trustee or through a declaration by an owner that identified property is held on trust, provided the legal requirements for creation are satisfied.
ADGM applies English common law and principles of equity, supplemented by the ADGM Trusts (Special Provisions) Regulations 2016. The ADGM-specific Regulations address matters including protection from certain foreign-law claims, non-charitable purpose trusts and enforceability of foreign trusts. General trust concepts and Trustee duties are substantially derived from English trust law as applied in ADGM.
Who can act as a trustee of a trust governed by ADGM law?
ADGM guidance states that a Trustee may be a natural person, a corporate Trustee or a Private Trust Company, subject to applicable legal and regulatory requirements.
The Trustee becomes the legal owner of the trust property and assumes the duties associated with that office. The choice of Trustee is therefore a central part of the structure.
Where a person carries on a trust business by way of profession in or from ADGM, ADGM states that licensing and authorisation requirements, prudential and conduct standards and AML/CFT obligations under the FSRA framework apply.
What ongoing compliance obligations can apply to a trust governed by ADGM law?
The trust itself does not have the same annual entity filings as an ADGM company or Foundation because it is not an ADGM-registered legal entity. However, compliance obligations can still arise for the Trustee and other relevant persons.