What is company liquidation?
Company Liquidation is a formal procedure in which a company is brought to an end by
liquidating the assets and settling the debts, paying expenses, and transferring the balance to
There are two types of businesses operating in the UAE. One is those having a business on
the mainland and the other one is the ones operating in free zones.
No matter what type of business you own the closing procedure of the companies involves
the cancellation of business licenses and all permits associated with the business.
Why liquidation is required:
There are 2 reasons why a company needs to get liquidated: –
- The original aim of the entity is fulfilled and its operations are not required anymore.
- The company has been declared to be insolvent.
Company liquidation Process in UAE: –
The liquidation process in UAE depends on the type of company. The major criteria on which
the liquidation depends are:
- The type of ownership i.e. if its sole proprietor or formed by a group of shareholders
- Type of liquidation i.e. if it’s voluntary or forced
- The area in which the company is established, i.e. free land or mainland
General Rules of liquidation across UAE are: –
- The Board’s resolution of dissolution must be formed and approved. This has to be attested
by the Nary public in the case of LLCs registered in the UAE. Free zone companies generally
need attestation by the Notary public.
- Liquidators must be appointed to liquidate the company. These are registered and approved
liquidators in UAE.
- Submission of all necessary documents like trade license, shareholders resolution, POA, MOA,
application form, Passport copies, and EID of all the partners, etc.
- Once a provisional liquidation certificate is given, a newspaper advertisement has to be
published by the company in English as well as Arabic. A notice period of 45 days.
- All employee visas should be cancelled, internet and phone bills should be paid off, bank
account closure should be done and also all clearance letters from government authorities
should be in place in these 45 days.
- The liquidation report is prepared by the auditor.
- NOC should be presented from the business unit.
- The completed report with all supporting documents and liquidation fee must be submitted.
- After reviewing the documents, the authority issues a license cancellation certificate.
Company Liquidators like Farahat and co. ensure that the liquidation process for your company remains
smooth and hassle-free. Liquidators in Dubai having a team of government-approved Liquidators and
dedicated professionals who can help you with all your liquidation procedures easily.
Get in touch with them to know further about the procedure and formalities to start with the