Company liquidation in Dubai Science Park free zone is the ideal exit strategy for businesses registered with the free zone. Liquidation allows you to legally shut down your company’s operations by satisfying the claims of all the stakeholders involved such as investors, shareholders and employees. All you need to do is appoint the best company liquidators in Dubai who can help you meet the latest steps and requirements to wind up a company.
In this article, we will provide you with some valuable lessons on certain mandatory requirements and steps you need to execute while liquidating a company in Dubai Science Park free zone. The free zone is regulated by the Dubai Development Authority (DDA) and you need to follow DDA’s regulations to wind up your company. Read ahead to know what those steps and requirements are:
Pass a Board Resolution
This is the first step of company liquidation in the Dubai Science Park free zone. The shareholders or directors need to pass a board resolution regarding the liquidation of the company. All the shareholders or directors are required to sign the resolution and send it to the DDA.
Appoint a Company Liquidator
Appointing company liquidators in Dubai is the most important step in the liquidation process. You need to appoint an official liquidator who will oversee the entire process of winding up the company. The liquidator can be any audit firm licensed to carry out its operations in the UAE. The free zone authority should be notified about the appointment and the name & address of the liquidator.
Letter of Acceptance from the Liquidator
Once appointed, the liquidator should send a letter to the free zone authority confirming his appointment. From this point, the power of the directors or shareholders over the company will transfer to the liquidator.
Cancel all the Visas
All the visas under the company must be cancelled including that of your employees. You must also cancel the establishment card of your company.
Obtain Clearance Certificates
TECOM is managing the Dubai Science Park free zone and you must get clearance from the finance department at the TECOM Group to prove you don’t have any outstanding liability. Approach the TECOM Leasing Department to get a NOC from them, stating the date on which you will be vacating the premises.
Clearance must be obtained from Dubai Customs, DEWA and Etisalat / Du. Moreover, you must return the keys to the premise after vacating them. Original documents must also be returned to the relevant department in the free zone.
Close your Corporate Bank Account
If your free zone company has a corporate bank account, it must be closed before winding up the company. Once the account is closed you need to obtain a letter of closure from the bank and submit it to the free zone authority.
Apply for VAT De-registration
Companies that are registered for VAT must apply for de-registration before the liquidation process commences. The application for VAT de-registration must be submitted to the Federal Tax Authority (FTA) within 20 days of becoming eligible for it. Skipping this critical requirement will attract a hefty penalty of AED 10,000.
Comply with Economic Substance Regulations
Companies going through the procedures of liquidation in Dubai Science Park need to meet their obligations under the Economic Substance Regulations (ESR). If a company has conducted any of the nine relevant activities, it must meet ESR requirements such as filing of notification, submission of ESR report and the ESR Test.
The nine 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. Non-violation of ESR requirements will attract hefty administrative penalties.
Meet Ultimate Beneficial Ownership Requirements
Companies undergoing liquidation in the UAE need to meet their obligations outlined in Cabinet Decision No. (58) of 2020 on Ultimate Beneficial Ownership (UBO). As per this law, companies under liquidation need 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. Moreover, the liquidator or administrator is required to maintain the RBR and PSR for at least five years from the date of liquidation. Hefty penalties await those who violate the UBO requirements.
Advertise in the Newspaper
You need to advertise the company’s liquidation 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.
Submit the Final Liquidation Report
The process of liquidating a company in Dubai Science Park will come to an end when the liquidator submits his final liquidation report to the free zone authority. The Registrar will then strike off the company’s name from the free zone register and cancel the company’s trade license. Experienced company liquidators in Dubai can help you finish the procedure quickly.
Hire the Best Company Liquidators in Dubai, UAE
The process of company liquidation in Dubai Science Park involves both complex and simple steps. However, you can meet all the mandatory requirements by appointing the best company liquidators in Dubai such as Jitendra Business Consultants (JBC). We are one of the leading providers of company liquidation services in Dubai with an impressive track record for the mainland, free zone and offshore companies. Consult with JBC’s company liquidators in Dubai today to close down your company without any hassle.