Liquidation is a process where a company ceases to do business by selling all its assets and the proceeds from the sale of assets are used to settle the liabilities, pay expenses, and remaining to the shareholders.
Types of liquidation
- Voluntary liquidation- where the company will choose to cease voluntarily as they have no funds to pay for the creditors.
- Compulsory liquidation- where the company liquidates by the court order and force them to pay the creditors by selling off its assets.
If you are going to liquidate a company in Dubai following are the various formal procedures to be followed. Take a look at them:
- Obtain the shareholders’ resolution of dissolution which is attested by the notary public in the case of LLC. If the shareholders are not available then it should be attested from UAE embassy and then attested by the Ministry of foreign affairs
- Appointment of a liquidator who will regulate all the processes related to liquidation and collect the official acceptance letter from them. In some cases, it is compulsory to appoint a liquidator to ensure the complete transparency in the proceedings.
- Inform the authority under whose authority the trade license is issued and an application for license cancellation must be initiated.
- Submit the following documents to the relevant licensing authority:
Trade license copy
Shareholder’s passport/Emirates ID copy
Deregistration application form
Letter of appointment of liquidator
- Provisional liquidation certificate will be issued and proceed for in two local newspapers about the notice of liquidation, one of them in Arabic, for atleast 45 days
- Now you have a period of 45 days to get clearance letters from all the departments like immigration, labor department, leasing entity, RTA, Federal customs authority, and bank closure letter. Also, cancel the work permits and work visa.
- Once the notice period is over the liquidator should prepare and submit a liquidation report to the relevant licensing authority.
- After the submission, it will be reviewed and the company will be issued a certificate of liquidation.
The Liquidation process will vary depending upon the ownership criteria, type of liquidation, the jurisdiction of registration, etc.
Our team will assist you throughout the process and will make liquidation easy.