According to Cointelegraph, the Ras Al Khaimah Digital Assets Oasis (RAK DAO), a free economic zone in the United Arab Emirates focused on digital assets, is set to introduce a legal framework for decentralized autonomous organizations (DAOs). The new regime will be introduced and discussed at the DAO Legal Clinic on Oct. 25, as announced by law firm NeosLegal and RAK DAO.
Irina Heaver, a partner at NeosLegal, stated that the framework is expected to clarify how DAOs can remain legally compliant, which she believes will significantly impact decentralized governance and the broader Web3 ecosystem in the UAE. The new framework will address legal and governance requirements for DAOs, including establishing a legal structure. This structure will clarify tax obligations and benefits, enable property ownership of onchain and offchain assets, and provide legal protection from personal liability for a DAO’s founders, members, and contributors.
The legal framework will also enable DAOs to enter legally binding contracts and establish guidelines for resolving internal and external disputes. Heaver mentioned that DAOs can be registered in the UAE under the new regime without physically being in the country, allowing them to be “established remotely.” This remote accessibility makes it easier for global participants to engage with the UAE’s burgeoning virtual assets sector.
Heaver believes that introducing the legal framework would continue to establish the UAE’s position as a global hub for blockchain and digital asset innovation, attracting entrepreneurs and developers. While Switzerland also allows DAOs to be set up through a legal wrapper, the process in the UAE is much more cost-effective. In Switzerland, a DAO setup may cost up to $46,000, whereas in the UAE, the process could start at $3,000. This affordability allows even the smallest DAOs to protect themselves and operate within a legal framework.
Weatherly
