Hi Daniel,

I'm Shilpa Sharma, and this is a great question because many investors confuse an SPV with a regular operating company.

The answer is yes, a Free Zone company can own an SPV (Special Purpose Vehicle). In fact, it's quite common for businesses to use an existing company as the shareholder of an SPV when they want to hold investments, intellectual property, shares in other companies, or specific assets.

However, it's important to understand that an SPV is not just another trading licence. It is incorporated as a separate legal entity, usually in specialised jurisdictions such as ADGM or DIFC, where dedicated SPV regulations exist.

Before approving the application, the authority will normally ask you to demonstrate the purpose of the SPV, for example, holding shares, owning assets, facilitating structured financing, or managing investments.

Unlike a normal company, an SPV is designed to remain passive. It isn't intended to carry out day-to-day trading, provide services to customers, or employ an operational workforce. Its role is to own and manage specific assets or investments.

You'll also need to comply with ongoing regulatory requirements, including Ultimate Beneficial Owner (UBO) disclosures and corporate tax registration where applicable. In many cases, the jurisdiction will also require you to appoint an approved Corporate Service Provider (CSP) to maintain the registered office and handle administrative filings.

If your goal is asset protection, investment structuring, or holding shares in multiple companies, an SPV can be a very effective structure when set up in the right jurisdiction.