The Qatar Financial Centre (QFC), based in Doha, has rolled out a detailed set of rules to regulate and create digital assets. This move marks a significant step in establishing a strong foundation for digital assets in Qatar.
New Digital Asset Framework Announced
The QFC’s regulators, the Qatar Financial Centre Authority (QFCA) and the Qatar Financial Centre Regulatory Authority (QFCRA), have introduced a new framework to guide the development of digital assets within the QFC. These rules cover essential aspects like the tokenization process, legal recognition of property rights in tokens, and the management of custody, transfers, and exchanges. The framework also includes provisions for recognizing smart contracts legally.
Much like the free economic zones in the United Arab Emirates, the QFC operates with its own legal, regulatory, tax, and business rules, separate from the rest of Qatar. This allows the QFC to offer unique benefits, such as up to 100% foreign ownership and full repatriation of profits. Additionally, the QFC applies a competitive 10% corporate tax on profits sourced locally.
Ensuring Security and Trust in the Digital Asset Ecosystem
The newly announced framework aims to create a secure and transparent digital asset ecosystem in the QFC that aligns with international standards. The QFC emphasizes that the framework sets high standards for asset tokenization, aiming to build trust and confidence among consumers, service providers, and stakeholders.
A Milestone in Qatar’s Financial Strategy
Qatar Central Bank Governor, His Excellency Sheikh Bandar bin Mohammed bin Saoud Al Thani, described the new regulations as a significant milestone in advancing the country’s “Third Financial Sector Strategy.” This strategy, launched in November 2023, is designed to help Qatar unlock its economic potential by creating a robust capital market and embracing emerging technologies.
The digital assets framework was developed in consultation with an advisory group of 37 domestic and international organizations from the finance, technology, and legal sectors. Since the launch of the QFC’s Digital Assets Lab in October 2023, over 20 startups have been accepted to develop, test, and commercialize their products and services within this innovative environment.
