Liquidation/Insolvency
The company enters into liquidation when it becomes insolvent or the shareholders opt to close the company for whatever reason. The court appoints the liquidators in the case of bankruptcy or by the investors.
A trade license is a crucial document for a company to establish and operate in the UAE, it must be revoked when the company is liquidated as per the legislation governing the company dissolution.
When the company passes a resolution for its dissolution in a shareholders’ meeting, the license is cancelled. You need to notarize the above-mentioned resolution in the case of a limited liability company (LLC). The notary of the decision for the company's dissolution is not necessary if the business is a sole proprietorship.
The liquidators shall be appointed in addition to the notarized decision, and the names of the liquidators, as well as their addresses, should be included in the resolution.
All of the following paperwork is submitted to the Department of Economic Development, which issues a liquidation certificate as proof that the company has begun the process of closing down. The company must publish an advertisement in the newspaper once they get the liquidation certificate. LLCs are required to run four advertisements in the Arabic language. The company will be given a 45-day notice period.
The company must get clearance from the immigration department and the labor department, and clear all the utility bills. The bank account closure letter is also provided by the bank.
Reyson Badger can help you with all these formalities and assist the company in all the legal formalities during the period of liquidation.