In the UAE Free Zones, appointing a company liquidator is not always mandatory when dissolving a business. The specific procedures for closing a Free Zone Company vary according to the regulations of the Free Zone Authority where the business is registered.

To begin the closure process, it is essential to inform the relevant Free Zone Authority in advance. The authority will then publish a liquidation notice. Business owners must obtain No Objection Certificates (NOCs) from utility service providers and other relevant government or Free Zone departments as required.

Following the approval of the necessary documents, business owners should proceed with canceling staff visas and work permits, and closing bank accounts. The final step involves receiving a formal termination letter from the Free Zone Authority, which signifies the completion of the company closure process.

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Process of Company Liquidation in UAE

The formal process of company liquidation in the UAE involves several key steps:

1. Preparation and Approval of Shareholders’ Resolution for Dissolution: Shareholders must draft and approve a resolution for the company’s dissolution. For Limited Liability Companies (LLCs) registered in the UAE, this resolution must be notarized by a Notary Public. If shareholders are not physically present in the UAE, the resolution must be notarized and then attested by the UAE Ministry of Foreign Affairs and the Ministry of Justice at the relevant UAE embassy. Most Free Zone companies require their documents to be notarized by a Notary Public.

2. Appointment of a Liquidator: A liquidator must be appointed, and a formal acceptance letter from the liquidator is required.
3. Submission of the Shareholders’ Resolution: The shareholders’ resolution, along with necessary documents and fees, must be submitted to the appropriate licensing authority. Required documents include a copy of the company’s Trade Licence, Memorandum of Association, Powers of Attorney (if applicable), and copies of passports or Emirates IDs for all partners, owners, and shareholders. A deregistration application form is also needed.

4. Publication of a Notice of Liquidation: Upon receiving a provisional liquidation certificate, the business must publish a notice of liquidation in a publicly accessible publication, in both English and Arabic. The number of required notices varies by authority but typically ranges from two to four.

5. Notice Period: A notice period of up to 45 days may be required, depending on the registration jurisdiction. During this period, the following actions must be taken:

   – Cancel all work permits and visas for employees and partners.

   – Obtain clearance letters from the Immigration Department, Labour Department, utility companies (water, electricity, and telecom services), leasing entity or landlord, Road & Transport Authority (RTA) if there are registered vehicles, and the Federal Customs Authority (FCA).

   – Close the company’s bank account and obtain a closure letter.

   – Complete VAT deregistration and obtain a VAT clearance letter from the Federal Tax Authority (FTA).

6. Completion of Liquidation: After the notice period expires, the appointed liquidator will prepare the Liquidation Report. This report, along with all necessary supporting documents, must be submitted to the competent Authority. Upon reviewing the application and receiving the required cancellation fees, the Authority will issue a “License Cancellation Certificate” if the application is approved.