RAK DAO Innovation City DAO Association Regulations 2024 (DARe)chapter by chapter

Regulation 102 - DAO Association Formation and Registration — Regulation 10

Before issuing any new Token class, submit to the Registrar a white paper, a legal opinion confirming UAE law compliance and non-security status, and a cybersecurity audit of Smart Contracts.

Regulation 112 - DAO Association Formation and Registration — Regulation 11

A DAO Association may only conduct business consistent with its trade license, avoiding activities regulated by UAE financial services regulators, and must stay lawful and within UAE public policy.

Regulation 122 - DAO Association Formation and Registration — Regulation 12

A DAO Association must state its Purpose plainly in its Constitution, and amend it only with unanimous Council approval, a Governance Proposal, and Registrar approval based on a detailed rationale.

Regulation 132 - DAO Association Formation and Registration — Regulation 13

DAO associations must have a non-profit purpose in their Memorandum or Constitution, prohibiting dividends to Token Holders and requiring would-be dividend assets to be reinvested consistent with that purpose.

Regulation 142 - DAO Association Formation and Registration — Regulation 14

As a condition of incorporation, a DAO Association must be deployed on a permissionless distributed ledger, with its entire software code developed in an open-source, publicly accessible format.

Regulation 162 - DAO Association Formation and Registration — Regulation 16

Draft a durable Constitution in English for DAO Associations, including required information and making it accessible to members.

Regulation 172 - DAO Association Formation and Registration — Regulation 17

Every DAO Association must produce a written Memorandum of Association, kept separate from its Constitution, containing Registrar-prescribed information and kept current at all times.

Regulation 202 - DAO Association Formation and Registration — Regulation 20

After a DAO Association is registered, the association must promptly circulate the information submitted to the Registrar to all Founding Members and Officers as soon as reasonably practicable.

Regulation 222 - DAO Association Formation and Registration — Regulation 22

Constitution amendments require a governance proposal passed by governance token holders, a registrar-requested legal adviser opinion on compliance, and registrar registration before taking effect.

Regulation 272 - DAO Association Formation and Registration — Regulation 27

DAO Association must ensure its full name, registered number and registered office address appear in all formal business documents.

Regulation 282 - DAO Association Formation and Registration — Regulation 28

DAO Associations must keep electronic records and ensure data protection against loss or falsification.

Regulation 292 - DAO Association Formation and Registration — Regulation 29

Founding member details, including legal name, address, guarantee statement and passport copy, must be recorded in the internal register and updated whenever a founding member notifies a change.

Regulation 333 - Managers, Registered Agents and Secretaries — Regulation 33

DAO Associations must publish a public electronic address, at minimum an e-mail address, for communications, and actively monitor and display it where no Manager or Registered Agent is appointed.

Regulation 353 - Managers, Registered Agents and Secretaries — Regulation 35

Organisations must keep an up-to-date Internal Register recording particulars of each council member, officer, manager and registered agent, natural person or corporate.

Regulation 364 - DAO Association Membership and Governance — Regulation 36

DAOs must maintain at least three membership categories and clearly define rights and obligations of all members.

Regulation 374 - DAO Association Membership and Governance — Regulation 37

Each Founding Member of a DAO must provide a Guarantee before incorporation, document it in a Guarantee Statement and Internal Register, and complete AML/CFT and KYC checks.

Regulation 384 - DAO Association Membership and Governance — Regulation 38

DAOs must issue Governance Tokens with Constitution-defined rights, and holders reaching 25% of voting rights for 30 consecutive days must declare this and provide details to the Registrar within 15 days.

Regulation 394 - DAO Association Membership and Governance — Regulation 39

A DAO Association must maintain at least two Council Members at all times, each eligible and Registrar-approved, with Register entry.

Regulation 404 - DAO Association Membership and Governance — Regulation 40

DAO Council Members are elected and replaced through the Governance Token Holder process, and removals or appointments must be notified to the Registrar within 14 days.

Regulation 434 - DAO Association Membership and Governance — Regulation 43

Where council meeting minutes are kept, they must be recorded electronically and entered in the internal register.

Regulation 444 - DAO Association Membership and Governance — Regulation 44

Council Members and Officers of a DAO Association must act lawfully, honestly, in good faith and in the association's best interests, with reasonable prudence, and respect Token Holder rights.

Regulation 454 - DAO Association Membership and Governance — Regulation 45

A Council Member with a direct or indirect interest in a transaction materially conflicting with the DAO Association must promptly disclose the nature and extent of that interest to the Council or Officer.

Regulation 464 - DAO Association Membership and Governance — Regulation 46

No financial assistance to a Council Member or connected persons unless Central Bank rules are met, a Governance Proposal approves it, and minutes record prior resolution.

Regulation 474 - DAO Association Membership and Governance — Regulation 47

Council Members must complete notification, Governance Proposal approval, signed consent, and identity verification before appointing an Alternate Council Member.

Regulation 495 - Tokens — Regulation 49

A DAO must maintain an accurate Electronic Internal Register of founding members, council, officer and minutes details, open to free inspection and error rectification applications.

Regulation 556 - Governance Proposals — Regulation 55

Governance proposals may be approved without a general meeting via electronic circulation with minimum seven-day voting notice, or at a general meeting; actions under invalidly approved proposals must be reversed promptly.

Regulation 667 - Sub DAO Associations — Regulation 66

Every registered Sub DAO Association must appoint and continuously maintain at least one natural person to manage its affairs.

Regulation 687 - Sub DAO Associations — Regulation 68

A Sub DAO Association with no attributable assets or liabilities may be terminated with written notice to the Registrar within 7 days; reinstatement requires the Registrar's prior written approval.

Regulation 697 - Sub DAO Associations — Regulation 69

Sub DAO Association acts must be executed on its behalf, and misattributed transactions must be investigated, corrected, and affected parties notified in writing of the attribution and their rights.

Regulation 707 - Sub DAO Associations — Regulation 70

The Council must keep Sub DAO Association assets identifiable and segregated from general assets and other associations' assets, and apportion assets and liabilities between them.

Regulation 747 - Sub DAO Associations — Regulation 74

Prepare financial statements reflecting the DAO Association's segregated structure, its impact on Founding Members, Token Holders and counterparties, and any Sub DAO net-asset deficit.

Regulation 878 - Accounts — Regulation 87

DAOs must maintain accurate electronic accounting records accessible to officers and auditors and preserve them for five years after the DAO's existence.

Regulation 888 - Accounts — Regulation 88

Companies must set a first financial year of 6-18 months from incorporation, notify the Registrar within 3 months, and keep later financial years at 12 months.

Regulation 898 - Accounts — Regulation 89

Entities must prepare true-and-fair annual accounts using the Registrar's template, have Council Members sign them, obtain auditor reports within six months, and file audited accounts with the Registrar within seven days.

Regulation 909 - Annual Return and No Objection Certificates — Regulation 90

DAO Associations must submit an accurate, plain-language Annual Return on the Registrar's standard template within four weeks after each financial year ends, and answer Registrar queries promptly.

Regulation 919 - Annual Return and No Objection Certificates — Regulation 91

Any person must obtain a written No Objection Certificate from the Registrar before issuing any new token class or listing one on a regulated market; non-compliance incurs penalties.

Regulation 9210 - Auditors — Regulation 92

A DAO Association must appoint an auditor by Governance Proposal, and removes one only by Governance Proposal unless the Constitution specifies otherwise.

Regulation 9410 - Auditors — Regulation 94

Persons must not knowingly or recklessly give the DAO Association's auditor false or misleading information, or obstruct the audit by concealing documents, coercing the auditor or denying access.

Regulation 9610 - Auditors — Regulation 96

A resigning DAO auditor must be reported to the Registrar, its ceasing-office statement circulated within 14 days where relevant, and a replacement auditor appointed within 30 days.

Regulation 10011 - The Registrar — Regulation 100

Persons must comply promptly with any written Registrar notice requiring them to provide specified information or produce specified documents.

Regulations 4-51 - General — Regulations 4-5

The DAO Association Regulations apply to DAO Associations incorporated in the Zone, and prevail over the Commercial Companies Law where the two conflict.

Regulations 9, 192 - DAO Association Formation and Registration — Regulations 9, 19

Founding members seeking DAO Association incorporation must file a prescribed application with the Registrar and refrain from business in the Zone until licensed.

Regulations 23-252 - DAO Association Formation and Registration — Regulations 23-25

DAO Association must obtain Registrar-approved name ending in DAO Limited or DAO Ltd, avoid prohibited name categories, and change misleading names within 30 days when directed.

Regulations 30-323 - Managers, Registered Agents and Secretaries — Regulations 30-32

DAO must appoint a Manager or Registered Agent at all times for compliance and Authority communications, ensure the agent is licensed and Registrar-approved, and obtain Council approval before binding actions.

Regulations 50-515 - Tokens — Regulations 50-51

Issuers of miscellaneous or combined governance and miscellaneous tokens must provide in the Constitution for all associated rights and obligations and for multiple token classes.

Regulations 52-535 - Tokens — Regulations 52-53

Token Constitution must specify voluntary Token disposal and mandatory disposal conditions, thresholds and triggers, and the DAO must administer both disposal processes as they arise.

Regulations 56-586 - Governance Proposals — Regulations 56-58

Companies must call general meetings on at least 21 days' electronic notice, and must call a meeting within 2 months of a valid Governance Token Holder request, with notices including agenda and proposals.

Regulations 59-616 - Governance Proposals — Regulations 59-61

Default voting provisions for governance proposals are applied unless stated otherwise in the Constitution, including quorum and chairman selection.

Regulations 62-677 - Sub DAO Associations — Regulations 62-67

Alpha DAO Associations must obtain prior written approval from the Registrar before creating each Sub DAO Association and can maintain up to 10 at any time.

Regulations 101-10212 - Amalgamations — Regulations 101-102

A DAO Association may amalgamate with other DAO Associations or foreign-incorporated entities only with the Registrar's discretionary consent, applying in the prescribed form with required documents.