UAE to introduce legal framework for DAO

RAK DAO, the UAE's digital asset-focused free economic zone, plans to introduce a legal framework for decentralized autonomous organizations (DAOs), Cointelegraph reported on 18 October. Law firm NeosLegal and RAK DAO said the new regime will be launched and discussed at the DAO Legal Clinic on Oct. 25.Irina Heaver, a partner at NeosLegal, said the framework is intended to clarify how DAOs will maintain legal compliance, which she believes will have a significant impact on the UAE's decentralized governance and the broader Web3 ecosystem.

RAK DAO's announcement states that the new framework will address the legal and governance requirements of DAOs, including the establishment of a legal structure. The legal structure will clarify tax obligations and tax benefits. It will also enable DAOs to have property rights in on-chain and off-chain assets and provide legal protection from personal liability for DAO founders, members and contributors. The legal framework will also enable DAOs to enter into legally binding contracts and establish guidelines for resolving internal and external disputes. Under the new regime, DAOs can be registered in the UAE without having to physically enter the country, and DAOs can be “remotely established” without having a physical presence in the UAE.