Much has been spoken about the disruption and the innovation brought about by the cryptocurrencies and blockchain in general. But amongst other things, a new technology almost always disrupts and affects the conventional methods of managing a workforce.
Various jurisdictions in the world are increasingly witnessing formation of regulations for implementation of blockchain and launch of cryptocurrencies. Case in point, UAE has so far shown a progressive approach towards the adaptation of technology. In December 2017, it was announced that the Dubai government aims to be a fully blockchain powered government by the year 2020. Abu Dhabi Global Market (ADGM) through its regulatory arm Financial Services Regulatory Authority recently amended its existing regulations to make space for ‘Conducting of Crypto Assets Business’ in UAE. Securities and Commodities Authority (SCA), the financial regulator of Dubai earlier this month, announced that SCA has approved a plan to regulate initial coin offerings (ICOs) and recognize them as securities. UAE has also seen incorporation of multiple cryptocurrency exchange houses in last few years. Other than the above, at the very grass-root level, UAE has supported the start-ups and innovation through incubators like DIFC’s Fintech Hive and Masdar City’s Krypto Labs. Dubai Silicon Oasis (DSOA)- Dubai Technology Entrepreneurship Centre (DTEC), one of the oldest and the most prominent technology incubators in UAE, has been predominantly supportive of technology based start-ups for over half a decade now, DTEC has also launched multiple programmes to facilitate launching of blockchain based start-ups from DSOA. DSOA has also proposed to introduced, various regulated categories for issuance of crypto-currencies.
Therefore, now having achieved the required sophistication and understanding, in terms of commencement of the implementation of this technology, it is essential to focus on the likely issues in terms of corporate governance that may arise out of this. This article aims to identify and address key issues that are likely to arise in terms of the existing labour laws in the United Arab Emirates when coupled with cryptocurrencies.
Employment relationships in the UAE are regulated by the UAE Federal Law No. 8 of 1980 (as amended)
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