The United Arab Emirates is focused on building a robust business infrastructure to support business and drive economic growth. Foreigners from all over the world continue to move to Dubai for a better life and better opportunities. There are immense possibilities in Dubai for company formation and to operate a successful business and LLC is the most favorite entity.
But sometimes, things don't work out as they should. A company can go into debt, or due to mismanagement, the company will officially close. Today, we will give you an overview of how to close your LLC Company in Dubai.
Liquidation of LLC Company in Dubai
Liquidation of an LLC company in Dubai is the process of closing your company and canceling its license and any attributes related to the company’s existence.
No matter what type of business you own in the Emirates, you must cancel your trade license and all related permits related to it when you make your decision to close your business down. There are several reasons both positive and negative to liquidate a company. The company could be at a loss or would want to close the current business and open another venture or even due to personal reasons.
LLC License Cancellation Dubai - Details
Relevant government entities need to know that you are no longer in the business, so you will have to avoid any accumulated penalties and fines incurred upon your business license when it is not renewed upon the expiry date. If you own a Limited Liability Company of this structure then ‘LLC license cancellation - Dubai’ becomes mandatory.
If you are in a shareholding company, it is necessary to discharge your liabilities towards creditors and partners and protect your shares and interests. It is also wise to put your goodwill and business reputation in perspective if you decide to set up a business again.
Procedure for LLC License Cancellation Dubai
There are many benefits of LLC company formation in Dubai. However, at times tables turn, and shutting it down becomes the final option. The decision for any LLC license cancellation - in Dubai depends on the corporate entity, however, there are certain steps to be followed and they are.-
- Prepare notarized minutes of the general assembly confirming the business liquidation and the appointment of a liquidator.
- Arrange an official letter by a registered liquidator accepting the duty.
- Apply for cancellation by filling out the required form through DED or other approved channels.
- DED will issue a liquidation certificate.
- Publish the notice of liquidation in two regional newspapers.
- The notice gives the debtors a grace period of 45-days from the date of issue to submit their claims.
- Submit DED a declaration letter from the liquidator and the partners indicating no objection from any other parties during the grace period.
- Collect the required approvals of other government bodies to cancel a license.
- Cancel the firm card at the Ministry of Human Resources and Emiratisation.
- Cancel the foreign partners' visas sponsored by the company at the respective General Directorate of Residency & Foreigners Affairs
- Submit all the above documents to get approval for final cancellation.
- DED will determine the fees.
- You can receive the Certificate of Deregistration (cancellation) after paying the requested fees.
Procedure for Closing LLC Company in Dubai
When completing the official steps for closing an LLC company in Dubai, all the company partners must be available in the country (or their Power of Attorney, who is approved and attested to sign the shareholder resolution to close the company). Once you have applied for the cancellation of a business through the Department of Economic Development (DED), then you must follow these steps -
1) Closing your Company Bank Account
Any active bank accounts in the trade name of the company must be officially closed. Upon closing the account, you must request a Statement of Account for the last financial year; this will be needed for a Liquidators Report. Also, a Bank Account Closure Confirmation must be requested from the bank as proof of closure.
2) Immigration Clearance
Any active visas under the legal sponsorship must be canceled in addition to any dependent visas under any employee sponsorship.
3) Clearance from the Required Regulating Authority
The Regulating Authority must obtain clearances about the company's activity; for example, if you would like to close down a trading company, a clearance letter should be requested from the Chamber of Commerce and the Ministry of Customs.
4) Third-Party Clearance
All fees must be paid to the landlord for any commercial space the business is renting, and a clearance letter must be obtained. You will also require a final bill from DEWA or ADDC etc., and confirmation of terminated utility services registered under the company name.
5) Deregistration of Publication
A company must file a notification in a regionally based newspaper/gazette publication which states that the company is in the procedure of liquidation. In Abu Dhabi, this requires a 45-day period to allow any creditors to raise any issues before the liquidation is approved.
6) Company Assets
Any property under the company or shares held in other companies in the business name must be sold or transferred. Proof of transfer or sale will be needed for the Liquidators Report.
7) Liquidators Report
An approved auditing company must be used that is licensed to prepare a Liquidators Report for the company.
8) Confirmation Certificate
Once all the aforementioned steps are complete, you can apply for a Confirmation Certificate confirming the termination of the company license and deregistration of the company.
With these simple steps, you'd be able to close your LLC business in Dubai.
Suppose you are considering officially closing your LLC or foreign branch office in Dubai. In that case, consultants at Commitbiz can assist you with this process and all the appropriate steps above.
Get in touch with us today!
Is Closing LLC company in Dubai possible?
Yes, you can close your LLC company in Dubai.
Is liquidation of LLC company in Dubai tough?
Though the procedures may be a little intricate, it will be easy if you reach out to a business consultant.
For liquidation of LLC company in Dubai, should all the partners be available in the country?
Yes, it is required for all the partners to be in the country.
Where to apply for closing LLC company in Dubai?
You can apply through the Department of Economic Development.
Should LLC liquidation decisions be published?
Yes, you must publish it in two regional newspapers.