VARA Administrative Order No. 01/2022 Regulating Marketing and Advertising of Virtual Assets

1 سلطة دبي لتنظيم األصول االفتراضية AUTHORITY REGULATORY ASSETS VIRTUAL DUBAI ... ADMINISTRATIVE ORDER NO. 01/2022: RELATING TO REGULATION OF MARKETING, ADVERTISING AND PROMOTIONS RELATED TO VIRTUAL ASSETS

1. Virtual Asset is defined in the Dubai Virtual Asset Law as: ‘a digital representation of value that may be digitally traded, transferred, or used as an exchange or payment tool, or for investment purposes; This includes Virtual Tokens [a digital representation of a set of rights that can be digitally offered and traded through a Virtual Asset Platform], and any digital representation of any other value as determined by VARA’.
2. For the UAE – this implies the need for compliance with relevant Federal or Financial Free Zone regulations when the entity is licensed under their Regulatory Authority and is outside VARA jurisdiction ً ّ التعريفات الرئيسية: :Definitions Key I أو ًال: المقدمة INTRODUCTION I
3. This Administrative Order No. 01/2022 relating to Regulation of Marketing, Advertising and Promotions related to Virtual Assets [Marketing Regulation] applies to all marketing, promotions and advertisements which relate to VA or VA Activities in the Emirate.
4. Marketing, promotion or advertising in this Marketing Regulation includes, but is not limited to, any direct or indirect form of the below [at minimum] - [Marketing]:
5. The Dubai Virtual Asset Law applies to VA Activities in all zones across the Emirate of Dubai, including Special Development Zones and Free Zones, but excluding the Dubai International Financial Centre – [the Emirate].
6. Any legal entity[ies] or individual[s] providing and/or facilitating the relevant VA service[s] as defined by the Dubai Virtual Asset Law [the Entity]. i. Communications, publication of data, information, promotional￾influenced-and/or-sponsored material – across any traditional and new￾age multi-media channels etc.; ii. Self-generated or Third-party published social media posts/blogs, comments, endorsements, non-written communications, banners/billboards, videos, live-streams etc.; iii. Activities held in the Emirate to encourage market participation in the sector – specifically soliciting clients or incentivising purchase of any VA products/services; and The Dubai Virtual Assets Regulatory Authority [VARA] was established and authorised by Law No. [4] of 2022 Regulating Virtual Assets in the Emirate of Dubai [Dubai Virtual Asset Law] as the competent entity in charge of regulating, supervising and overseeing Virtual Assets1 [VA] and Virtual Asset Service Providers [VASPs] conducting authorised Virtual Asset activities [VA Activities] in the Emirate of Dubai. iv. Advertisements [paid or non-paid] and all forms of publicity-driving content served across any platform and channel [owned, partner/affiliate or intermediary] etc. General Principles applicable to this Marketing Regulation in full: :التسويق ونظم قواعد على قةّالمطب العامة المبادئ
7. VARA Licensed VASPs will be subject to all requirements mandated in the Licensing Conditions, and are advised to incrementally review Sections II and III hereunder for completeness.
8. VARA reserves the right to amend this Marketing Regulation at any time, at its sole discretion.
9. This Marketing Regulation applies to all Entities – domestic or foreign, whether or not they are licensed by VARA to provide VA specific activities insofar as they are catering for/targeting residents and/or customers within the Emirate or the UAE2, in relation to VA or VA Activities. ّ II ثانيً ا: اإلرشادات التسويقية REGULATION MARKETING II
10. All Marketing relating to VA and/or VA Activities in the Emirate must: ف االفتراضية األصول وأنشطة االفتراضية باألصول قة .1 ّ i. Be fair, clear, not misleading and clearly identifiable as marketing or promotional in nature; ii. Not mislead in relation to the real or perceived advantages of VA; iii. Include a prominent disclaimer that the value of VA is variable [up and/or down], cannot be guaranteed, and can be highly volatile; iv. Not advocate that investments are safe, low risk or that returns are guaranteed; v. Not imply that investment decisions are trivial, simple, easy or suitable for all [without due diligence]; vi. Not imply that past performance of investments is an effective guide for, or guarantee of a future return – as such, any investment decision must be strictly based on consumer’s independent evaluation; vii. Not imply an urgency to buy VA in anticipation of future gains, or create a fear of missing out on future gains, by not buying now; viii. Not advocate the purchase of VA using credit or other interest accruing facilities; ix. Ensure that any targeted Marketing is undertaken responsibly by suitably licensed Entities, to present only appropriate products or services to the audience, including but not limited to defined criteria on investor qualification, and event attendance; and x. comply with all applicable laws, regulations, guidelines or other rules applicable across the United Arab Emirates [the UAE], and in specific to the Emirate, including but not limited to those relating to Marketing, data protection and consumer protection.

2 2. Paid content refers to any Entity posting, publicising, or otherwise presenting content on any physical or virtual media platform [including social media, OTT etc.] in relation to VA or VA Activities, in exchange for any form of remuneration or value in kind [VIK] offer for the service, and such content must be clearly indicated to have been paid for. 3. Any Entity undertaking Marketing in relation VA or VA Activities in the Emirate must retain a record of all of relevant content, and audience details etc. for a minimum of two years from their date of last publication or activity edition, and made available to VARA for inspection on request. 4. The issuance of any kind of VA, whether or not transactional in nature, as part of Marketing or any other engagement purpose [including where they may be specifically limited in usage, to granting the holder – access to specific facilities, services, activities, events etc.] is classified as a VA Activity, and will be subject to licensing approval by VARA. II ثانيً ا: اإلرشادات التسويقية REGULATION MARKETING II i. Seek authorisation from VARA prior to conducting any such Marketing; ii. Provide valid permit to undertake such VA Activity, by the competent authority in the territory [outside of the purview of the VARA] in which the Entity is located; and iii. Comply with all requirements in this Marketing Regulation. 5. Any Entity that facilitates Marketing in relation to VA or VA Activities, including but not limited to traditional and digital broadcasters, publishers, search engines, social media and other internet platforms, must ensure that all Marketing activity in relation VA or VA Activities in the Emirate, or targeting residents of and/or customers within the Emirate or the UAE, complies with all applicable laws, regulations, guidelines or other rules applicable across the UAE, and in specific to the Emirate, in particular to this Marketing Regulation, and other standards prescribed to assure data protection, and consumer protection. ّ 6. Marketing by an Entity [i] not conducting VA Activity in the Emirate; [ii] that originates outside the UAE; AND [iii] is not targeting any residents of the UAE – is not required to comply with this Marketing Regulation, however VARA will have authority to act if it views that such Marketing poses a risk to [a] its reputation as a competent regulator; or [b] the reputation of the UAE or the Emirate with regards to its management to VA sector. 7. Any Entity that is not authorised by VARA to undertake VA Activity in the Emirate but wishes to conduct any form of Marketing targeted at directly, or indirectly addressing any residents of and/or customers within the Emirate in relation to VA and/or VA Activities, must: 2. VARA reserves the right to call for such activity suspension if it is not satisfied with the Entity assurances, or otherwise has reason to believe requirements of this Marketing Regulation will not be met. 3. In particular, should VARA require an event, to be suspended or cancelled, the Entity responsible for organising, hosting, promoting or managing such event must announce the suspension or cancellation immediately to the public, clearly stating non-compliance with this Marketing Regulation as the reason for such action, in the body of the announcement. 4. Failure to comply with the above regulation, and providing VARA with necessary assurances of remedial actions in case of violations, will result in consequential penalties or fines as defined in Administrative Order No. 02/2022. ّ III VIOLATION AND REMEDIAL ACTIONS

1. Any Entity that VARA deems to be in violation of this Marketing Regulation, will be issued a notification to cease and desist from undertaking, or continuing any and all associated activities [including events], and the Entity must comply in accordance, immediately upon receipt of such warning, regardless of their stage of ‘in-market’ operation, immediately upon receiving notice from VARA. …. …. HELAL SAEED ALMARRI Chairman Virtual Assets Regulatory Authority END OF DOCUMENT