Special Purpose Vehicles: A cornerstone of business structuring

With the economic surge driving companies and investors to Dubai, many are choosing to set up holding companies or Special Purpose Vehicles (SPVs), also known as Prescribed Companies in DIFC, to hold local assets. Such legal structures provide businesses with greater control, security, flexibility, and tax efficiency. 

Designed to protect assets and manage financial and legal risk, SPVs have grown in popularity. These structures have become a mainstay in corporate strategy with diverse applications across sectors. They are widely used by companies, governments, venture capitalists, technology firms, and are particularly popular among high-net-worth individuals and family businesses seeking to manage assets, mitigate risks, and plan for succession.

In an evolving geoeconomic landscape, SPVs are helping companies expand into emerging markets, drive innovation, take measured risks, and scale faster.

DIFC is playing a key role in driving growth in this segment by offering a wide range of company structures within a safe jurisdiction and world-class legal framework. As a result, it continues to attract regional and global firms looking to optimise business performance and efficiently manage risks through legal structures, while ensuring regulatory compliance. Although each company structure has a unique purpose, suitable application and distinct advantages, SPVs remain a popular choice among DIFC’s existing clients as well as new entrants. 

Over time, DIFC has evolved regulations to meet the changing needs of clients, in line with global best practice. The Centre has extended its SPV offering to meet demand from its rapidly growing private wealth, asset management, family wealth, FinTech and innovation sectors. Whether it is a family managing its business interests, an airline managing their assets, an asset manager structuring investment vehicles, or a start-up founder or innovator who wishes to hold intellectual property rights, a broad range of parties can benefit from setting up an SPV. 

For family businesses, particularly those with complex global structures, SPVs serve as an ideal tool for succession planning and business continuity. With multi-generational success as the end goal, families can leverage these structures to streamline decision-making and accountability, and mitigate risks associated with fundraising and insolvency. 

The advantages of DIFC’s company structures are further complimented by the Centre’s overall proposition for businesses - a hyper-connected ecosystem, proximity to financial institutions and professional service providers, and access to fast-growing regional markets and top-tier talent. With a 20-year track record of driving the future of finance and innovation, DIFC continues to create value for companies by providing them with the right environment, structures and solutions to accelerate growth. 

The near-term outlook for SPVs remains positive. Their flexibility and risk mitigation features are gaining prominence as the global business and trade landscape undergoes major shifts. Dubai is expected to see strong momentum in the uptake of these structures with the continued inflow of private wealth and foreign investment, as well as from family businesses who are an important part of diversifying the city’s GDP.

When choosing a structure, businesses must carefully evaluate their primary objectives, whether it is asset protection, estate planning, investment diversification, tax efficiency, or operational flexibility. Understanding the available structures and their benefits can help companies and investors navigate the complexities of investment structuring, ensuring they are strategically positioned for success.