How to Close a Mainland Company in the UAE
To officially close (dissolve / liquidate) an LLC in the UAE, it is advised that you follow each step to ensure that all elements and licences associated with the LLC are closed to avoid any issues in the future. If you cease operations of a company without officially cancelling the business licences and obtaining a full liquidation you will accumulate fines and penalties when it is not renewed.
If you have a company with multiple shareholders, the process takes a bit longer as you must release your liabilities towards any partners or creditors and liquidation of shares is required. Certain types of companies require an official liquidator and liquidator report, these include:
- General Partnership
- Limited Liability Company
- Simple Limited Partnership
- Public Joint Stock Company
- Private Joint Stock Company
When going through the steps of officially closing a mainland company in the UAE, all company partners must be available in the country (or their Power of Attorney who is approved and attested to act to sign the Shareholder Resolution to close the company). Once you have applied for cancellation of a company through the Department of Economy (DED), you then must follow the below steps:
Step 1: Closing a Company Bank Account
Any active bank accounts in the name of the company must be officially closed. Upon closing the account you must request for a Statement of Account for the last financial year, this will be required for a Liquidators Report. In addition a Bank Account Closure Confirmation must be requested from the bank as proof of closure.
Step 2: Immigration Clearance
Any active visas under the company sponsorship must be cancelled in addition to any dependent visas under any employees sponsorship.
Step 3: Clearance from the Required Regulating Authority
Clearances must be obtained by the Regulating Authority in relation to the activity of the company, for example, if you would like to close down a trading company, a clearance letter should be requested from the Ministry of Customs and the Chamber of Commerce.
Step Four: Third Party Clearance
All dues must be paid to the landlord for any commercial space the company is renting and a clearance letter should be obtained. In addition you will require a final bill from DEWA or ADDC etc and confirmation of terminated utilities services which are registered under the company name.
Step Five: De-registration Publication
It is mandatory for a company to file a notification in a locally based newspaper/gazette publication which states that the company is in the process of liquidation. In Abu Dhabi this requires a 45 day period to allow any creditors to raise any issues before the liquidation is approved.
Step Six: Company Assets
Any property under the company or shares held in other companies in the entity name must be sold or transferred. A proof of transfer or sale will be required for the Liquidators Report.
Step Seven: Liquidators Report
An approved auditing company must be used who are licensed to prepare a Liquidators Report for the company.
Step Eight: Confirmation Certificate
Once all the above steps are complete, you can apply for a Confirmation Certificate confirming the termination of the company license and de-registration of the company.
If you are considering officially closing your LLC or Foreign Branch in Dubai, Abu Dhabi or the wider UAE, PRO Partner Group can assist you with this process and all the relevant steps above. For more information on Company or Branch closure please contact Greg Hastings at PRO Partner Group direct on +971 56 991 1278 or firstname.lastname@example.org or please contact a member of the team on email@example.com in Abu Dhabi +971 (0)2 448 5120, or Dubai +971 (0)4 456 1761.