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Liquidating a UAE Mainland Company
Mainland company liquidation in the UAE is the procedure by which failing businesses lawfully cease operations in the UAE. Companies may be forced to liquidate their businesses for a variety of reasons, including a crisis or financial collapse.
Having the proper knowledge about Company Winding up Procedures in the UAE would come in handy in circumstances where a business investor needs to liquidate their company in the UAE owing to unanticipated events or shifting the business jurisdiction from the Mainland to Free Zones, etc. There are a few measures to take for Mainland Company Liquidation in the UAE.
If your organization fits under the following legal forms of business. To begin the process of winding up the firm in the UAE, you must first select a liquidator.
- General Partnership
- Limited Liability Company
- Simple Limited Partnership
- Public Joint Stock Company
- Private Joint Stock Company
How to liquidate a mainland company in the UAE?
The company’s closure in the UAE mainland is divided into two stages.
Stage 1:
- 1. Notarized minutes of the shareholder meeting certifying the company's insolvency and the appointment of a liquidator.
- 2. Apply for company cancellation by completing the appropriate form through DED or other permitted methods.
- 3. Apply for company cancellation by completing the appropriate form through DED or other permitted methods.
- 4. Obtain the liquidation certificate after submission.
- 5. Publish the liquidation notice in two local newspapers.
- 6. The debtors have 45 days from the date of issue to submit their claims
Stage 2:
- 1. Submit declaration letter from liquidator & partners, stating no objections during grace period, to DED.
- 2. Collect the appropriate clearances from other government entities to terminate a licence.
- 3. Cancel your firm card from the Ministry of Human Resources and Emiratisation.
- 4.Cancel corp.-backed foreign partner's visa at Residency & Foreign Affairs.
- 5. Submit all above docs for final cancellation clearance
- 6. Pay the cancellation fees and receive the certificate of deregistration after paying the relevant amounts.
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Dubai Company Liquidation – Frequently Asked Questions
The timeline can vary based on factors such as the company’s financial complexity and the effectiveness of the liquidation procedure. On average, it takes several months to finish.
No, there are alternative choices, such as mergers and acquisitions or selling the company. However, if you decide to discontinue operations, liquidation is the formal procedure to follow.
During liquidation in Dubai, employees are typically entitled to receive their outstanding dues, including salaries and end-of-service benefits.
The company may need to provide notice or payment instead of notice. Employees could be transferred to another company within the group, subject to agreement, or work permits may be canceled in compliance with regulations.
Legal and fair treatment of employees is essential during this process.
In the majority of cases, a company ends operations when the court imposes compulsory liquidation. The focus switches to debt repayment and asset distribution.
While it is doable, the legal and administrative intricacies make it extremely prudent to seek professional advice. Experts can help make the process more efficient and compliant.