ADQ and Turkey's wealth fund form $300m fund to invest in tech start-ups

Abu Dhabi's holding company ADQ and Turkey Wealth Fund formed a new $300 million technology fund that will focus on investing in start-ups in Turkey, further deepening the UAE's investment ties in the country.

Turkey Technology Fund (ADQ TWF) will invest in companies developing new technologies or improving existing technology in sectors that include energy and utilities, health care and life sciences, food and agriculture, mobility and logistics, financial services, and education, the Abu Dhabi Government Media Office said on Thursday.

"Turkey is an attractive market with substantial opportunities for investing in vital sectors that align with our areas of expertise," said Mohamed Alsuwaidi, managing director and chief executive of ADQ.

"By providing access to the national and regional champions in our portfolio, we will help to unlock even greater value for these companies and funds with high-growth potential.”

ADQ TWF's launch comes as the Abu Dhabi holding company sealed agreements with several Turkish investment entities to boost the development of priority sectors in both countries last year. ADQ signed partnership deals with the Turkey Wealth Fund, Turkey Investment Office and CCN Holding, the Abu Dhabi media office said at the time.

The two countries have been deepening their trade and investment ties since the visit of Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, to Turkey last year. During the visit, the UAE also announced a $10 billion fund to support strategic investments in Turkey, including in energy, health and food.

ADQ TWF was launched by Mohamed Alsuwaidi, managing director and chief executive of ADQ, and Arda Ermut, chief executive and board member of TWF. Photo: TWF

“This fund marks the first step taken by the TWF as part of its vision to build a broader $1 billion technology platform, to become the reference technology fund accelerating technological growth in Turkey and driving growth in strategic technological sectors critical to Turkey’s development," said Arda Ermut, chief executive and board member at TWF.

The move will also enable ADQ to tap into fast-growing Turkish start-ups, the statement said.

Turkish start-ups accounted for 30 per cent of all venture capital transactions closed and more than half of all capital put into start-ups across the Middle East and North Africa, Turkey and Pakistan in 2021, ADQ said.

The Turkish venture capital ecosystem reached its highest quarterly, half-yearly and yearly level of capital raised by local start-ups in late 2021, it said.

"The Turkey Technology Fund will create a unique added value for our country with its volume and international direct investment dimension and the multiplier effect it will provide for other technology investments,” Mr Ermut said.

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Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks.

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.

8. Pillar 2 implementation

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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