Company liquidation in Dubai Outsource City offers a robust exit strategy for business owners registered with the free zone. If you are on the brink of shutting down your business, company liquidators in Dubai advise you to exit your operations using the liquidation process. When faced with hardships, many foreign investors think of abandoning their company and fleeing the country. However, company liquidation in Dubai saves you from opting for such illegal measures and lets you wind up your company in peace.
The UAE liquidation process allows you to shut down your company’s operation by fulfilling the interests of all the stakeholders involved, including creditors and employees. However, the process of company liquidation in Dubai encompasses a series of mandatory steps and regulatory requirements. Providers of company liquidation services in Dubai can help you navigate all such steps. Keep reading to understand how to wind up a company in Dubai Outsource City free zone:
Pass a Board Resolution
Passing a board resolution is the first step in the process of company liquidation in Dubai Outsource City. The resolution must state the reasons for liquidating the company. The resolution must be signed by all the shareholders or directors of the company. The signed board resolution must be notarized and sent to the free zone authority. Dubai Development Authority (DDA) is the authority that regulates and controls the Dubai Outsource City free zone.
Appoint a Company Liquidator
Next, you have to appoint a liquidator who will oversee the entire process of winding up your company. The liquidator can be an audit firm holding a valid license to carry out its operations in the UAE. The name and address of the UAE liquidator must be stated in the resolution to be sent to the free zone authority.
Submit Liquidator’s Acceptance Letter
Once appointed, the company liquidator is required to send a letter to the free zone authority expressing the willingness to accept the role. Remember that all the powers of the directors/shareholders will be transferred to the liquidator at this point.
Cancel Visa & Establishment Card
All the visas held by the company must be cancelled, including that of the employees. You should also cancel the establishment card after the visa cancellation.
Obtain Clearance Certificates
You need to obtain clearance from the finance department at the TECOM Group regarding any outstanding liability. A No Objection Certificate (NOC) must be obtained from the Leasing Department stating the date on which the company will be vacating the premises. NOC should also be obtained from Dubai Customs, DEWA and Etisalat / Du. A letter of closure must be obtained from the bank where the company had a corporate account. Moreover, keys to the premise and original documents must be returned to relevant departments in the free zone.
Apply for VAT De-registration
If your company is a VAT registrant, it is mandatory to apply for VAT de-registration before the liquidation process commences. You need to submit an application for de-registration to the Federal Tax Authority (FTA) within 20 days of becoming eligible for it. The FTA will impose a penalty of AED 10,000 if you fail to meet this key requirement.
Comply with Economic Substance Regulations
Companies undergoing liquidation in Dubai Outsource City are advised to check their obligations under the Economic Substance Regulations (ESR). You are required to meet the ESR requirements such as filing of notification, submission of ESR report and the ESR Test if you have conducted any of the nine Relevant Activities. The nine ESR Relevant Activities are Banking business, Insurance business, Lease-Finance business, Investment Fund Management business, Holding Company business, Headquarters business, Shipping business, Intellectual Property business and Distribution & Service Centre business. Failing to meet ESR requirements will make you liable to pay hefty administrative penalties.
Advertise in the Newspaper
The company’s liquidation must be advertised in both English & Arabic Newspapers. The newspaper advertisement must state that the interested parties can make any claim against the company within the lock-in period of 45 days, counting from the date of the newspaper advertisement. The free zone authority will not accept any claim made after the grace period.
Meet Ultimate Beneficial Ownership Requirements
Companies under liquidation need to ensure they have met their obligations set out in Cabinet Decision No. (58) of 2020 on Ultimate Beneficial Ownership (UBO). As per the Decision, companies undergoing liquidation are required to hand over the Real Beneficiary Register (RBR) and Partners or Shareholders Register (PSR) to the free zone authority within 30 days of appointing the liquidator. The liquidator or administrator should maintain the RBR and PSR for at least five years from the date of liquidation. Meeting this key requirement is critical to avoiding hefty penalties.
Submit the Final Liquidation Report
The process of company liquidation in Dubai Outsource City will conclude once the liquidator submits his final liquidation report to the free zone authority. Upon the submission of the report, the Registrar will strike off the company’s name from the free zone register and cancel the company’s trade license. Avail of reliable liquidation services in Dubai to ensure compliance with all the relevant laws and standard procedures.
Hire the Best Company Liquidators in Dubai, UAE
You need to diligently execute all the mandatory steps to successfully complete the process of company liquidation in Dubai Outsource City. Considering the complexity of the process, it is advisable to hire experienced company liquidators in Dubai such as Jitendra Business Consultants. JBC is a leading provider of company liquidation services in Dubai with an impressive track record for free zones, and mainland and offshore companies. JBC can help you easily navigate complex requirements such as ESR and UBO to speed up the process of liquidation in Dubai. Consult with JBC’s company liquidators in Dubai today to peacefully close down a company.
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