Company Liquidation

This is the process of cancelation of a trade license in UAE in the unlikely event of a business closure. In order to avoid penalties for non-renewal of a license, it is mandatory to follow a series of procedures to wind up a business legally, which can be quite grueling at ones difficult times. We can take care of this hassle with minimum interference needed from the customer, meanwhile ensuring a clean finishing.

We understand the importance of settling dues and profits among creditors and partners, from the perspective of keeping your goodwill and business reputation; we foresee the possibility of restarting your venture sometime in the near future.

Formalities for canceling business license

The cancelation procedures varies based on business forms; the sole proprietorships and establishments, being the simplest. All you need to do is apply for cancellation through DED by submitting the below documents:

NOC from Directorate of Residency and Foreigners Affairs

NOC from Ministry of Human Resources and Emiratization

NOC from Local Services Agent

Letter stating the reason for Company Liquidation

For companies with shares, the steps are more because it requires liquidating the shares, collecting the debts and paying off the creditors before finalizing with DED.
If your company is one of the below mentioned, you need to appoint a liquidator:

General Partnership

Simple Limited Partnership

Limited Liability Company

Private Joint Stock Company

Public Joint Stock Company

Prepare a notarized minute of the general assembly stating the company liquidation and the appointment of an auditor for the Liquidation.

Submit all the Company Documents and Details of the appointed auditor to the DED (Dubai Economic Department).

DED issues a liquidation certificate

Publish the notice of liquidation in local newspapers (Both in English and Arabic) for 45 days.

From the date of issue, the notice gives the debtors a grace period of 45 days to submit their claims

Cancel all the employment/Partner Visa under the Company.

Cancel labour and Immigration files of the Company and obtain NOC from both the departments.

Obtain an NOC from the Local Partner

Prepare a letter stating the reason for Company Liquidation.

Prepare the audit report of the Company.

Obtain NOC from all the external departments (If required).

Submit all the aforementioned documents to the DED to get the approval for final cancellation

After paying the requested fees, you can receive the certificate of deregistration (cancellation)

Freezing a trade license

Freezing is different than terminating a business license completely. In UAE, companies have an option to keep their trade licenses inactive for up to three years by paying a certain freezing fee. For this you need to submit:

NOC from Ministry of Human Resources & Emiratization and Directorate of Residency and Foreigners Affairs

Letter stating the reason for freezing

Once the trade license is Freezed you can retain the License at any time.

According to UAE Labor Law, employers need to give their employees a two-month, paid notice period before terminating their contracts. In most of the cases, employees can retain their residency visas until the company’s trade license runs out. In addition to this, the company needs to cancel its utilities and telecommunication services. Afterward, collect an NOC from the utilities service provider for the closing process.

Prime Global Business Services will guide you through the entire process and help you understand the pros and cons in each stage of company liquidation. We invest our time to listen to what our clients say. Get in touch with us for a free expert advice!

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