RAK DAO to unveil a legal framework for DAOs in the UAE on October 25.
The framework allows remote registration and clarifies legal and tax requirements.
The UAE’s Ras Al Khaimah Digital Assets Oasis (RAK DAO) plans to introduce a legal framework for decentralized autonomous organizations (DAOs). This framework will be discussed at the DAO Legal Clinic, an event organized by the law firm NeosLegal, on October 25.
Significantly, the new framework aims to clarify the governance and legal requirements for DAOs operating within the UAE. According to Irina Heaver, a partner at NeosLegal, the framework will establish a clear structure for DAOs. This will include addressing tax obligations and benefits, allowing DAOs to own both on-chain and off-chain assets, and offering legal protection for DAO founders, members, and contributors.
The framework also includes provisions that will allow DAOs to engage in legally binding contracts. Additionally, guidelines for resolving both internal and external disputes will be introduced. These measures are intended to provide legal clarity and stability for DAOs, ensuring they can operate in compliance with UAE regulations.
Remote Registration for DAOs
One significant feature of the new legal framework is the ability for DAOs to be registered remotely. This means that organizations will not need a physical presence in the UAE to establish legal status. Irina Heaver highlighted that this feature will allow global participation in the UAE’s growing digital assets sector.
The ability to register remotely is expected to attract international DAOs looking for a favorable regulatory environment. Additionally, registered DAOs will be able to open local bank accounts, facilitating their financial operations. This move could help simplify the process of managing funds and transactions linked to the virtual assets space.
By reducing the financial barriers to entry, the UAE provides a competitive option for decentralized organizations. This legal framework is expected to attract a range of DAOs looking for an accessible, cost-effective environment to operate. Moreover, the introduction of this legal framework highlights the UAE’s approach to creating a supportive regulatory environment for DAOs. It establishes clear guidelines for governance, tax obligations, and legal protections, promoting a better understanding of how these organizations can operate within the law.
This framework is expected to simplify the process for DAOs to register and manage operations. Hence, making the UAE an attractive destination for decentralized entities. Moreover, it may encourage collaboration between DAOs and traditional businesses.