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What is a Special Purpose Vehicle (SPV)?

A Special Purpose Vehicle (SPV) is a separate legal entity created to carry out a specific activity without affecting the main business. It stands on its own, meaning its finances, assets, and risks are kept completely independent. Companies use SPVs when they want to isolate certain projects, manage particular assets, or take on ventures that should not impact the parent company's overall stability.

Unlike holding companies, which actively manage several subsidiaries and oversee broad business operations, SPVs are usually passive structures with one clear purpose. For example, real estate developers often form an SPV for each property they build, keeping every project financially separate. Investment firms may create SPVs to hold individual funds or portfolios, while financial institutions rely on them for securitization and other complex financial transactions. This focused setup makes SPVs efficient, clean, and easy to track.

When a business needs to oversee many operating companies or manage different business lines, it typically forms a holding company instead. SPVs, however, are best used when a single project or asset needs its own legal "container." By isolating liabilities, an SPV protects the parent company from risks tied to that specific venture, offering strong legal and financial separation for safer, more flexible business operations.

Key Advantages of SPVs

Asset Protection

Asset Protection

SPVs separate specific assets from your main business, protecting them from general business liabilities and creditor claims.

Risk Isolation

Risk Isolation

Project-specific risks stay contained within the SPV. If one venture fails, your primary business remains unaffected.

Tax Efficiency

Tax Efficiency

SPVs allow flexibility in tax planning and optimization. Different structures provide tax advantages for your objectives.

Simplified Financing

Simplified Financing

Lenders prefer financing SPVs for specific projects. Clear asset allocation makes project financing easier to arrange.

Clean Exit Strategy

Clean Exit Strategy

Selling a specific business line becomes simpler when it operates through an SPV without affecting main operations.

Stakeholder Clarity

Stakeholder Clarity

SPVs provide clear separation for different investor groups. Each party knows which assets relate to their investment.

SPV Structures Across Dubai Jurisdictions

Dubai Mainland SPVs

Dubai Mainland SPVs

Mainland SPVs follow federal and emirate laws, suitable for onshore dealings, asset holding, and structures needing broader UAE market access.

DIFC SPVs

DIFC SPVs

DIFC SPVs operate under a common-law regime, ideal for cross-border investors seeking predictability, tax neutrality, and global credibility.

DMCC SPVs

DMCC SPVs

DMCC offers fast SPV setup, 100% foreign ownership, simplified filings, and strong support for holding, investment, and asset-protection uses.

Other Dubai Free Zones

Other Dubai Free Zones

Zones like DSOA, IFZA, and Meydan provide low-cost SPVs with streamlined compliance, easy onboarding, and full foreign ownership rights.

SPV vs Holding Company: Which Structure

Feature
Special Purpose Vehicle (SPV)
Holding Company
Purpose
Single specific purpose—holds defined assets or manages one transactionMultiple purposes—manages subsidiaries, holds diverse assets and investments
Operations
Passive entity—cannot conduct commercial operations or hire employeesActive operations—can conduct business, hire staff, sponsor employment visas
Cost
Lower costs—uses service provider address, minimal compliance requirementsHigher costs—requires physical office, staff salaries, comprehensive compliance
Setup Time
Quick setup—streamlined registration, faster establishment timelinesLonger setup—more complex registration, extensive documentation requirements
Risk Management
Risk isolation—separates one venture from primary business completelyBroader flexibility—operational scope extends across multiple business areas
Scope
Limited scope—restricted to predetermined business purpose and activitiesMultiple functions—manages various business lines and investment portfolios
Registered Office
CSP required—must use Company Service Provider for registered office addressPhysical presence—maintains actual office space and local presence requirements

Documents Required for SPV Registration

Document Type
Purpose
Mainland
Free Zone
DIFC / ADGM
Memorandum & Articles
Corporate governance frameworkRequiredRequiredRequired
Articles of Association (AOA)
Company constitutional rulesRequiredRequiredRequired
Business Plan
Project/asset descriptionRequiredRequiredRequired
Shareholder/Director Information
Identity verificationRequiredRequiredRequired
Passport Copies
Identity documentRequiredRequiredRequired
UAE Visa / Emirates ID
Residency verificationOptionalOptionalRequired (for residents)
Beneficial Ownership Declaration
Transparency & complianceRequiredRequiredRequired
Board Resolution
Shareholder/director approvalRequiredRequired (if parent company)Required
Proof of Address
Registered office locationRequiredRequiredProvided by CSP
Bank Reference Letters
Financial credibilityOptionalOptionalOptional

Our Scope in SPV Services

SPV setup demands expertise across jurisdictions and regulations. We guide you to create a compliant, well-structured SPV optimized for asset protection and business goals. Our consultants handle documentation, coordinate with authorities, and manage setup across Dubai Mainland, Abu Dhabi, DIFC, ADGM, and free zones, ensuring smooth operations from day one.

SPV Services in Dubai

  • SPV structure selection & planning
  • Jurisdiction recommendation & analysis
  • Complete documentation preparation
  • Government registration & approvals
  • Compliance framework implementation
  • Post-setup ongoing advisory support
  • Asset protection strategy guidance
  • Tax efficiency optimization planning

Ready to Structure Your SPV?

Get expert guidance on preparing your documentation and navigating UAE's regulatory landscape