On 20 March 2023, as part of its commitment to develop an innovative and diversified economy, Ras Al Khaimah (“RAK”) introduced through the enactment of RAK Law No. 2/2023 (the “New Law”) a new free zone named Ras Al Khaimah Digital Assets Oasis (the “DAO”). The Law aims to establish a free zone dedicated to digital and virtual asset companies.
Prior to the enactment of the New Law, a preceding enactment establishing the Department of the Future (the “DOF”) was enacted through RAK Law No. 1/2023. Based on the DOF Law, the DOF is mandated with playing a pivotal role in promoting innovation and economic development through the use of new technology in the fast developing digital economy. In connection with the establishment of the DOF as a precursor to the establishment of the DAO, DAO will now serve as a gateway for the establishment of companies and its operations related to digital and virtual assets. The New Law grants DAO with financial, administrative, and legislative independence, allowing it to function as a purpose-built, innovation-enabling free zone in the virtual assets sector.
Pursuant to the New Law, DAO is empowered to encourage young talent to implement their ideas and encourage global digital players to expand their footprint in the UAE. As of current, it is expected DAO will be open for applications in the second quarter of 2023.
By comparison in the digital and virtual assets sector, Abu Dhabi and Dubai have both enacted a raft of laws that promote regulation of virtual assets. It is therefore apparent that the digital economy and virtual assets category is an emerging activity not only in Abu Dhabi and Dubai but across the United Arab Emirates.
The recent enactment of the New Law is a positive step towards innovative, sustainable, and diversified economic growth in the United Arab Emirates and is an indication of RAK’s commitment towards developing and supporting the virtual assets sector. We expect it will attract more companies to establish their businesses in RAK and will further raise RAK’s profile as one of the centres for business and commercial activity within the United Arab Emirates.