Home Business The Right way to close down your business in UAE

The Right way to close down your business in UAE

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For seeking a better life and better opportunities, a huge number of expats come, live and work in UAE. Expats who wish to go for their own company formation in UAE are offered proper guidance from experts whereas those who seek job opportunities are provided with them as well.

A number of investors move towards UAE every year. Most of them settle down here permanently but some do not do so. The business owners who plan on the closing company in Dubai to return home must go through a number of processes before they leave UAE.

Winding up Your Business in UAE

Business owners and investors who do not wish to continue living and operating their businesses in UAE might just stop paying their trade license fees to wind up their businesses but this is not the right way. This inappropriate method can make you pay fine for not paying the trade license fees so you better skip it to avoid some serious consequences.

There can be a number of reasons behind the dissolution of the companies but when the company has decided to close down the business in UAE, it must go through the right processes at the right time. The best method for company dissolution is by the agreement of all the shareholders of the company. Ensuring that the company has paid off all the debts and has no existing claims may wind up by proper legal processes.

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If the company doesn’t pay off all of its debts, none of the partners will get their share when the company is subjected to dissolution. After the company is done with all the commercial affairs, it can go for the liquidation process easily. The company’s directors must ensure that all the assets of the company have been transferred and all the commercial contracts of the company have been terminated as well by the customers.

Signing the resolution

The shareholders of the company must sign a resolution which states the intention behind the dissolution of the company. The resolution must be legally notarized.

Appointment of the liquidator

A liquidator should also be appointed in the resolution. This is a very important and mandatory step of closing down a business. The appointed liquidator should carry out all of its duties carefully.

Approaching DED

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The representatives of the company may then approach the relevant authorities and submit the relevant documents and the fees. The authority which should be approached is the Department of Economic Development (DED) and if the company is incorporated in a free zone, relevant free zone authorities should be approached.

Advertising in the newspaper

The news of the closure of the company is advertised in at least local newspapers in UAE. This is done in order to provide the creditors some more time to come forward.

No Objection Certificate

After this, the costliest process is to be carried out in which it is ensured that all the outstanding dues have been paid by the company and all the employees under the sponsorship of the creditors have been left under the license of the company. For this purpose, a No Objection Certificate is obtained by the Ministry of Human Resources and Emiratization (MOHRE)

Additional approvals

Additional approvals may be needed to form other authorities as per the activities of the business.

Clearance of accounts and bills

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All the utility bills, accounts, electricity bills must be cleared after fulfilling all the requirements on time to close down the business in UAE. For more information visit Farahat & Co.

Evidencing from DED

A final application is then filed to the DED after the liquidator submits the report, cancellation of the visas, NOCs and newspaper announcement, closure of the accounts, etc.. A cancellation certificate is issued by the DED or relevant free zone authority demonstrating the company’s dissolution.