The Qatar Financial Centre (QFC) has unveiled a comprehensive regulatory framework designed to govern and facilitate the creation and management of digital assets. This new regime was introduced by the Qatar Financial Centre Authority (QFCA) and the Qatar Financial Centre Regulatory Authority (QFCRA) to establish a solid foundation for digital assets within the QFC.
The framework includes detailed guidelines on tokenization processes, the legal recognition of property rights associated with tokens and their underlying assets, as well as provisions for custody, transfer, and exchange of digital assets. It also legally recognizes smart contracts, further integrating advanced digital solutions into Qatar’s financial landscape.
Operating independently from the mainland, the QFC offers a unique regulatory environment, similar to the free economic zones in the United Arab Emirates. Businesses within the QFC enjoy benefits such as up to 100% foreign ownership, full repatriation of profits, and a competitive corporate tax rate of 10% on locally sourced profits.
The QFC stated that this framework is designed to ensure the security and transparency of the digital asset ecosystem, aligning with international standards. It also sets clear standards for asset tokenization, aiming to foster trust and confidence among consumers, service providers, and stakeholders.
His Excellency Sheikh Bandar bin Mohammed bin Saoud Al Thani, Qatar Central Bank Governor, highlighted that these regulations are a significant step towards achieving the country’s “Third Financial Sector Strategy.” He emphasized that the framework is expected to create substantial opportunities within Qatar’s financial sector.
Launched in November 2023, Qatar’s Third Financial Sector Strategy aims to develop a robust capital market to unlock the country’s economic potential, with a strong focus on embracing emerging technologies to accelerate digital transformation.
The development of this digital assets framework involved collaboration with an advisory group comprising 37 domestic and international organizations across finance, technology, and legal sectors. Since the launch of the QFC’s Digital Assets Lab in October 2023, more than 20 startups have been onboarded to develop, test, and commercialize their digital asset products and services.
