Company Liquidation in Dubai, UAE

Company Liquidation And Closing a Company | Dubai | UAE

Liquidator in Company Dissolution and Asset Distribution

The provisions of the Company Liquidation In UAE  Law about the liquidation are to be applied unless the company’s MOA (Memorandum of Association) or AOA (Articles of Association) give a specific process for its liquidation, upon resolving the organization’s dissolution an agreement is reached between the partners as to its liquidation’s procedure.

Upon the dissolution of the organization, it’s considered to be in the liquidation stage. While the liquidation process is being implemented the organization will retain its legal capacity for the implementation of its liquidation. It is imperative to affix the term ‘In Liquidation’ to the company name. During the liquidation, the organization’s administrative structure shall continue to exist, however, it will just perform functions which are not inside the jurisdiction of the liquidators.

The partners of the company’s general assembly by majority resolution must appoint one or more liquidators. If the liquidation is decreed following a Court Order, the Court will appoint the liquidator.

The death, insolvency, interdiction, or bankruptcy of a partner, even by such a partner had appointed the liquidator, would not affect the liquidator’s functions. Additionally, the liquidator should enroll his/her appointment as well as the method of liquidation with the Commercial Register.

In coordination with the manager or chairman of the  Company Liquidation In The UAE, the liquidator must create an inventory of assets as well as liabilities of the company. The chairman and managers have a statutory duty to hand over the organization’s accounts, documents, books as well as assets to the liquidator.

The liquidator must:

  • Prepare a detailed statement of company assets and liabilities as well as a balance sheet to be signed by him and manager or chairman of the company
  • A book of accounts should be kept for the liquidation of transactions
  • Preserve the assets of the company and its rights as well as the company debts
  • Open a bank account in the name of the company ‘in liquidation’ and deposit company funds.

Responsibilities of the Liquidator in Company Dissolution and Asset Distribution

The liquidator shall be the representative of the Company Liquidation In The UAE in any litigation regarding the company. They should must satisfy the creditors of the organization by selling its moveable assets or real estate in an auction or any other method specified in the liquidation process. The liquidator should not embark on new business unless it is necessary for the completion of previous works, otherwise, he will be personally liable for the consequences.

The liquidator must notify all the creditors by registered letters of the commencement of the liquidation. Such notice has to be published in local newspapers and also provides not less than 45 days during which the creditors must present their claims.

Certain debts of the company have to be prioritized and settled before others such as; employees’ salaries or wages, or debts accrued while the Company Liquidation In The UAE. Any amounts remaining after the settlement of the company debts will be proportionately disbursed amongst the partners. If the net proceeds of liquidation were insufficient to cover the repayment of all partners’ shares, the losses will also be divided proportionately amongst the partners.

At the end of the liquidation, a final account must be prepared and then presented to the general assembly or the partners. The liquidators will then get the record at the end of the liquidation in the Commercial Register as well as request that the Company Liquidation In The UAE be removed from the registration

How to Liquidate a Company in UAE Company. Step-by-Step Guide

MSZ Corporate Services Provider facilitates the seamless liquidation of companies in the UAE by offering expert guidance and comprehensive support throughout the process. From initial consultation to final closure, MSZ provides a step-by-step guide, ensuring adherence to legal requirements, smooth asset disposal, and timely completion of all necessary formalities for company liquidation in the UAE.

Process of Company Liquidation in Dubai, UAE

Company liquidation in Dubai, UAE involves a series of steps to officially close a business. This process ensures all legal and financial matters are resolved.

Here are the steps involved in company liquidation process in UAE:

  1. Preparing and Approving the Dissolution Resolution: Shareholders create and approve a resolution to close the company. For Limited Liability Companies (LLCs), this resolution must be certified by a Notary Public. If shareholders are outside the UAE, the resolution needs certification from the UAE embassy and attestation by the UAE Ministry of Foreign Affairs and Ministry of Justice.
  1. Appointment of a Liquidator: A liquidator is appointed to oversee the liquidation process. They must formally accept their role in writing.
  1. Preparation of Liquidation Reports: A provisional liquidation certificate is obtained, and a notice is published in both English and Arabic in a public journal.
  1. Submission of Required Documents: File the shareholders’ resolution and necessary paperwork with the appropriate licensing authority.
  1. Notice Period and Permit/VISA Cancellation: Initiate a 45-day notice period to cancel work permits, visas, and obtain clearances from Immigration, Labor, utility companies, leasing agencies, RTA, FCA, and close bank accounts. VAT de-registration is also required.
  1. Final Report and Cancellation Fees Payment: The final report and all necessary documents are submitted to the relevant authority along with the required cancellation fees.

Required Documents for Company Liquidation in Dubai, UAE

  • Photocopy of the original trade license
  • Photocopies of all shareholders’ passports
  • Photocopy of Emirates ID
  • Application form for deregistration
  • Resolution of the shareholders
  • Memorandum of Association (MOA)
  • Power of Attorney

Why is Company Liquidation Required?

Company Liquidation in Dubai, UAE can be necessary for several reasons and offers various benefits:

  1. Balanced Asset Division: Ensures all debts are paid and remaining assets are fairly distributed among shareholders.
  2. Starting New or Separation: Allows businesses to close current operations and start anew or separate from existing liabilities.
  3. Resolving Issues: Offers a structured way to resolve conflicts among shareholders
  4. Concluding Legal Dissolution: Provides a clear and legal process for closing the company and settling financial obligations.
  5. Meeting Regulatory Compliance: Helps companies meet legal obligations and avoid penalties.

While complex, company liquidation in Dubai, UAE ensures a structured and legally compliant closure of business operations, offering a fresh start and proper asset distribution for all involved. For assistance with the company liquidation process in Dubai, UAE, contact MSZ.

Contact

MSZ corporate services provider is court certified liquidator in UAE and leading liquidators in Dubai UAE with a wide experience in the field. We have guided our clients with the company liquidation process in Dubai, UAE. MSZ corporate services provider can help you to deregister your company smoothly within a short period. Click Here to Contact MSZ or Email to info@msz.ae.