UAE enters agreement to join the global Crypto-Asset Reporting Framework (CARF)

The United Arab Emirates (UAE) Ministry of Finance signed a Multilateral Competent Authority Agreement (MCAA) to join the global Crypto-Asset Reporting Framework (CARF). The initiative is meant to enable the nation to automatically share its tax reporting related to digital asset transactions with the global authority.

The framework was developed by the Organization for Economic Co-operation and Development (OECD). The initiative requires crypto exchanges, brokers, custodians, and wallet operators to reveal customer activity, including purchasing, selling, and transferring virtual currencies.

UAE opens public consultation

The framework is scheduled to roll out in 2027, and the country is expected to start sharing data with international tax authorities the following year. The CARF plan was first announced in November 2024, when the UAE revealed plans to reinforce its dedication to international tax transparency and regulatory consistency.

The country’s MoF said the initiative aims to ensure that the UAE provides certainty and clarity to the digital asset industry while maintaining global tax transparency. The agency also believes the framework is designed to mitigate tax evasion, reduce money laundering risks, and strengthen the integrity of the crypto market.

The MoF insists that the framework will offer greater clarity for investors and companies. It also asked the stakeholders to share their feedback on the framework’s potential impacts and areas requiring further clarification.

The government agency invited all stakeholders active in the crypto asset sector to participate in a public consultation on CARF implementation in the country. 

The MoF opened the public consultation for eight weeks, running from September 15 to November 8. The agency said the initiative aims to develop clear and effective regulatory rules with the help of insights from experts and stakeholders, and to align with market needs.

According to the report, the nation’s adoption of CARF positions it among more than 65 countries involved in the OECD framework. The UAE’s alignment with global best practices also pushed it a step closer to enhancing its standing as a financial hub and enabling greater cross-border cooperation to combat illicit conduct. 

The initiative also positions the UAE to follow existing regulatory parameters, including the Common Reporting Standard (CRS) and the U.S. Foreign Account Tax Compliance Act (FATCA). The MoF argued that the country’s strategy accords with international efforts to regulate the digital asset industry and maintain consistency with the evolving global regulatory landscape.

Mishra also acknowledged that the initiative brings greater legal clarity and certainty to crypto activities in the region, making the environment safer for compliant partners. He also argued that allowing public input on the framework suggests that final regulations might reflect market and investor needs. He added that it would attract institutional investors, since the rules help establish a fair, well-regulated marketplace.

UAE discusses latest financial and economic developments with the IMF

The MoF also engaged with the International Monetary Fund (IMF) delegation on Wednesday in Abu Dhabi, where they discussed the country’s economic projection and policy framework. The agency revealed that both parties reviewed the UAE’s macroeconomic performance, financial and banking developments, and its broader economic policies. They also discussed primary challenges and opportunities for promoting the nation’s sustainable economic growth.

The lead of the MoF delegation, Younis Haji AlKhoori, said the initiative showed the depth of the UAE’s strategic partnership with the Fund. The Undersecretary of the Ministry of Finance acknowledged that the agency was keen on strengthening its cooperation, since the IMF was still a key partner in supporting the ministry’s efforts towards fiscal and economic policy.

AlKhoori added that the regular consultations enable the MoF to design financial policies that keep pace with regional and global developments.

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