Out-Law News 2 min. read
07 Feb 2023, 12:40 pm
Dubai-based technology law specialist Martin Hayward of Pinsent Masons was commenting after the Dubai Chamber of Digital Economy (DCDE) said that the UAE’s digital economy is expected to grow from approximately $38 billion in value today to more than $140bn by 2031.
The estimation was cited in a new report published by the DCDE (84-page / 71.6MB PDF), which examines the factors that are helping digital start-ups to flourish in Dubai. It cites the ease of doing business, access to talent and capital, competitive tax incentives and a central base for global operations as reasons why Dubai-based start-ups attract more than half of funding for start-ups across the Middle East and North Africa region, excluding Israel.
According to the report, Dubai is seeking to become the leading digital economy hub in the world. As well as looking to attract tens of thousands of workers to work in tech, by 2030, the emirate’s ambition is to be home to more than 20 ‘unicorn’ companies – start-ups valued at more than $1 billion.
Dubai is already a recognised hub for global business and at the forefront of the smart cities movement and is well-placed to support innovation in technology sectors such as fintech and digital infrastructure
The report identified artificial intelligence (AI), blockchain, the metaverse, industry 4.0 technologies, and digital assets as the technologies of Dubai’s future digital economy, with specific ambitions listed for Dubai to become a world hub for digital assets and the metaverse. Further measures concerning the future-proofing of the city and support for innovative uses of technologies such as 3D printing and autonomous vehicles were also detailed.
Recognised in the report is the need for a regulatory framework that support’s Dubai’s ambitions for the digital economy.
Hayward said: “Growing the digital economy is at the heart of plans across the MENA region as governments seek to reduce their economies’ reliance on the oil and gas sector. Dubai is already a recognised hub for global business and at the forefront of the smart cities movement and is well-placed to support innovation in technology sectors such as fintech and digital infrastructure. Regulation can underpin such innovation provided it is proportionate to the risks.”
“We have already seen how regulation is emerging in relation to virtual assets to support growth in that areas in mainland UAE and in financial free zones such as the Abu Dhabi Global Market (ADGM) and the Dubai International Financial Centre (DIFC). Likewise, a supportive regulatory framework is central to successful implementation of the Dubai metaverse strategy published last year,” he said.
“While new regulations specific to the metaverse are expected to be explored in some jurisdictions in the years ahead, our view is that existing laws in areas such as consumer protection, data protection, competition, health and safety, employment, and intellectual property, could, in the short term, be extended to govern activities in the metaverse at this time, avoiding the need to create new regulation dedicated to the metaverse until the full potential of the metaverse becomes clearer,” Hayward said.
“To help foster innovation in the metaverse and in relation to other new technologies in the shorter term, policymakers and regulators in Dubai should create regulatory sandboxes that enable them to work together with industry to co-create regulations and address legal questions that arise. They should also consider the role that standards and guidelines can play in the absence of bespoke regulations to assist businesses in developing and deploying new technologies,” he said.
Recently, the DIFC announced a new ‘metaverse platform’. The platform comprises an accelerator programme under which developers can test their metaverse technology in a physical studio. The DIFC said the platform will also address policy development and legislation on open data, digital identify and company law frameworks in the metaverse, as well as foster the development of a metaverse community in Dubai.
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