The process of voluntary company liquidation in the Dubai Design District is the best exit strategy available for companies registered with the free zone. Opting for company liquidation in Dubai will help all the stakeholders including employees, creditors and clients to have an amicable settlement. Appointing experienced company liquidators in Dubai will help you to shut down the operations of your company with ease. Read ahead to know the Latest requirements and steps to liquidate a company in Dubai Design District:
Resolution to Dissolve the Company
Company liquidation in Dubai Design District commences with the shareholders notifying the free zone authority about the decision to wind up. Dubai Development Authority (DDA) is the authority that regulates the Dubai Design District free zone. The shareholders and directors of the company must pass a resolution to wind up the company. All the shareholders/directors must sign the resolution which must be submitted to the free zone authority. The resolution needs to be notarized by the Notary Public before sending it to the DDA.
Appointment of Liquidator
The management should appoint a liquidator who will officially carry out company liquidation in Dubai Design District. The liquidator can be an audit firm licensed to carry out its operation in the UAE. The name and address of the liquidator must be mentioned in the board resolution.
Letter of Acceptance from Liquidator
The liquidator is required to send a letter to the free zone authority, expressing his willingness to serve as the liquidator for the company. The shareholders should note that all of their powers will transfer to the liquidator at this stage.
Apply for VAT De-Registration
VAT De-registration is a critical requirement most business owners forget to fulfil while liquidating their companies. A company having an active VAT registration in the UAE must apply for deregistration before winding up its operation. The request for deregistration must be submitted to the Federal Tax Authority (FTA) within 20 days of qualifying for it. Companies violating this rule will attract a penalty of AED 10,000.
Comply with Economic Substance Requirements
Companies undergoing liquidation in Dubai Design District must check whether they fall within the scope of the Economic Substance Regulations (ESR). You will need to meet the ESR requirements if you have carried out any of the nine relevant activities such as 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. You will be required to meet mandatory ESR obligations such as notification filing, ESR report filing and Economic Substance Test. Companies failing to meet the ESR obligations will incur hefty penalties.
Ultimate Beneficial Ownership Regulations
Companies undergoing liquidation in Dubai Design District must meet the requirements as per Cabinet Decision No. (58) of 2020 on Ultimate Beneficial Ownership (UBO). The liquidating companies must 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. Apart from that, the liquidator or administrator must ensure that the registers are maintained for at least five years from the date of liquidation of the company. Hefty administrative fines will be imposed on companies that violate the UBO requirements.
Cancellation of Visas & Bank Accounts
All the visas must be cancelled including that of the employees. You must also cancel the Establishment card of the company as well. The bank account of the company must be closed and a closure letter must be obtained.
Clearance From Authorities & Utility Service Providers
Clearance letters must be obtained from government authorities and utility service providers such as Dubai Customs, Etisalat, DEWA etc. NOC must be obtained from RTA if any vehicle is registered under the company’s name. Clearance from Emirates Post must be secured if the company has a PO Box.
Return Original Documents
All the original documents you received during the time of incorporation must be returned to the free zone authority. Some of the original documents you must return include Trade License, Tenancy Contract, Memorandum & Articles of Association, Investment Service Agreement, Share Certificate, Certificate of Incorporation etc.
You must publish an advertisement in the newspaper notifying the public of your company’s liquidation. The advertisement needs to be placed in local English & Arabic newspapers. A grace period of 45 days will follow during which other parties can raise their claims towards the company’s liquidation.
Submission of Liquidation Report
The process of company liquidation in Dubai Design District will come to an end when the liquidator submits the final liquidation report to the free zone authority. Upon receiving the report, the Registrar cancel the company’s trade license and remove the company’s name from the free zone register.
Hire the Best Company Liquidators in Dubai, UAE
The process of company liquidation in Dubai Design District involves a series of steps and requirements. The entire process can be completed quickly if you appoint the best company liquidators in Dubai such as Jitendra Business Consultants (JBC). JBC is one of the leading providers of company liquidation services in Dubai with years of experience. Hire our qualified company liquidators in Dubai to ensure that your company is shut down in compliance with relevant laws and regulations.