Company liquidation in Dubai requires a qualified approach and a complete understanding of legislation which can help in efficient closure of the company. Liquidation of a company can either be voluntary or compulsory. For the purpose of liquidating a company in Dubai requires to follow regulations that are applicable in the region or country in which the company operates its business activities. A company can be liquidated due to various reasons and different procedures have to be followed for commencing liquidation of a company.
Factors to be considered before the liquidation
Few conditions can be considered before commencing liquidation process:
- Settling down all outstanding dues as per government priority list.
- Closure of Bank Accounts
- Preparing the Final Audit Report with the help of auditing firms in Dubai
Initiating the liquidation process in Dubai
A close of business can be initiated by various factors,
- If the majority of the shareholders decide to liquidate the company.
- If there is a court ruling to dissolve and liquidate the company
The first stage of liquidation
Procedures for closing down a company can be requested by creditors or shareholders. Following are a few procedures and details which are involved in the liquidation of a company in Dubai.
In case of Voluntary liquidation
A voluntary liquidation starts when the directors, and owners, mutually decide to close their business. The shareholders may conduct a meeting and pass appropriate resolutions for winding up.
In case of Compulsory liquidation
This type of company liquidation is put forward by court order. Creditors can request for liquidation if the company is not able to pay its dues. The person assigned by the court, freeze bank accounts and begin the investigation into what led to the company’s insolvency.
A liquidator will be appointed if there are assets to recover. Any remaining funds will go to the creditors, an investigation into the directors’ conduct is also carried out by the relevant authority to ensure any misconduct on behalf of directors.
These are some common steps required to complete the liquidation process including:
- Prepare a notarized minute of the general assembly confirming the company liquidation and the appointment of a liquidator.
- The relevant authority will issue a certificate of liquidation.
- Publish the notice of liquidation in local newspapers.
- Present the confirmation of the liquidator and all the partners proving no objection.
- Get a clearance letter from the relevant authorities.
- Submit a copy of Director Board resolution and a copy of liquidation certificate.
The final stage of liquidation
Once the liquidation process of a company in Dubai has commenced then the below-mentioned steps can be undertaken:
- The company is erased from the Trade Register.
- The business license is revoked.
- The dissolution of the company is officially announced through a statement signed by the liquidator in charge.
Violation of Procedures for Liquidation of a Company in Dubai
If the founder of the company in the UAE has left the company without renewing the business license and without undergoing properly the procedure of its liquidation, they will be denied future access into the country. If such a founder would decide to visit the Emirates after a certain period time, the entrance to the country may be closed for him.
It will be possible to solve this problem only after the full repayment of the outstanding debts of the company and accumulated penalties.
HHS lawyers and legal consultants are one of the leading liquidators in the country. We can guide you through step by step process of liquidation. Our specialized and expert team deeply investigates the case and executes the Company Liquidation process smoothly. For further consultation contact us