Company liquidation in the UAE is the process of winding up the operations of a business, marking its formal closure. Liquidation is the best form of exit strategy recommended for companies in the UAE as it enables the business owners to shut down their operations fulfilling the interests of all stakeholders involved including partners, investors and even employees. However, appointing company liquidators in the UAE is the most important step in the entire process.
Liquidators are responsible for executing all the steps involved in the liquidation of a company in the UAE. A liquidator can be any audit firm licensed to carry out its operations in the UAE. A liquidator is appointed by shareholders or directors through a board resolution during the summary winding up of a company in the UAE. In the case of compulsory liquidation, the UAE liquidators are appointed by the court. In both cases, we can’t undermine the significance of a liquidator’s role. In view of this, given below is an overview of a liquidator’s role in winding up UAE companies:
1. Confirmation of a liquidator’s appointment
The first responsibility of company liquidators in the UAE is to confirm their appointment. Depending on relevant laws regarding company liquidation in the UAE, the liquidator is mandated to send a letter of acceptance to the licensing authority. The liquidator is required to register in the commercial register, the decision of the shareholders or the court’s decision to appoint him as the official liquidator.
2. Take Stock of Assets & Liabilities
Once appointed, the liquidator must take stock of the assets and liabilities of the company undergoing liquidation. He is also tasked with compiling a record of the assets, liabilities and balance sheet of the company. Companies providing the best liquidation services in the UAE can ensure that such records are accurately compiled.
3. Keeps Record of Transactions
Liquidators must keep a record of all the transactions related to the winding up of the company. This is a critical procedure required to make sure that the liquidator has delivered all his duties and has not failed to fulfil his responsibilities.
4. Manages debt collection & sale of assets
Company liquidators in the UAE have to play a key role in initiating necessary steps to collect debts from third parties. The liquidator is in charge of opening an account for the company in which all pending debts are to be deposited.
5. The setting of Debts & Sale of Assets
The liquidators will also be in charge of key responsibilities including the settling of debts, sale of moveable assets or real estate through an auction or through any method specified in the liquidation documents. Company liquidators in the UAE must also represent the company in court if any court action is initiated against the company by the creditors.
6. Maintenance of UBO Registers
The Cabinet Decision No. (58) of 2020 on Ultimate Beneficial Ownership (UBO) applies to companies undergoing liquidation in the UAE. As per relevant clauses of this law, the liquidator is in charge of handing over the company’s Real Beneficiary Register (RBR) and Partners or Shareholders Register (PSR) to the relevant licensing Authority. Apart from that the liquidator also has the responsibility of maintaining the RBR and PSR for at least five years from the date of liquidation.
7. Request Removal of Company Name
After performing all the necessary procedures for winding up a company in the UAE, the liquidator should present a final report to the regulating authority. The report may contain a declaration of the assets and settlement of all liabilities. After presenting the report, the liquidator is required to request the Authority remove the company from the Commercial Register. To successfully complete all the steps of the process, the management should consult with companies that ensure the best company liquidation services in Dubai, UAE.
Hire the Best Company Liquidators in the UAE
Company liquidators in the UAE play a key role in winding up a company as appointing a liquidator is a mandatory requirement. Company liquidation in the UAE is an elaborate and complex process for which the business owners need to appoint experienced audit firms. Jitendra Business Consultants (JBC) is a leading provider of company liquidation services in the UAE with years of experience. JBC has an impeccable track record of winding up companies in free zones, LLCs on the mainland and offshore companies. Avail of our services today to wind up your company in line with relevant laws and standard procedures.