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Company Liquidation Process in the UAE
Liquidating a company in the UAE means officially closing it down by following legal procedures. Whether your business is in a free zone, mainland, or offshore, you must go through a formal process to settle debts, cancel visas, and close accounts before your trade license is canceled.
What is Company Liquidation?
Company liquidation is the legal process of shutting down a business permanently. It involves paying off all financial obligations, informing government departments, canceling employee visas, and officially removing the company from the trade register. This ensures that the business has no further responsibilities or legal ties in the UAE.
Why is Liquidation Necessary?
Liquidation is required to avoid future fines, penalties, or legal issues. Even if a company stops operations, it is still considered active unless properly liquidated. Officially closing your business ensures that employee rights are respected, all financial matters are settled, and you can safely exit the market without problems in the future.
Steps to Liquidate a Mainland Company in the UAE
Liquidating a mainland company in the UAE involves several important steps:
- Pass a Board Resolution: Shareholders must agree to close the business and sign a formal resolution to start the liquidation.
- Appoint a Liquidator: You must hire a certified liquidator who prepares reports and manages the liquidation process.
- Notify the DED: Submit your intention to liquidate to the Department of Economic Development (DED), which issues an initial approval.
- Publish a Newspaper Notice: The notice of liquidation must be published in two local newspapers for 45 days, giving time for any objections.
- Clear All Liabilities: Cancel employee visas, pay any unpaid salaries, close utility accounts, and settle outstanding debts.
- Obtain Clearance Certificates: You must obtain no-objection letters (NOCs) from relevant authorities, including immigration, labour, the bank, the municipality, and the telecom provider.
- Submit Final Liquidation Report: The liquidator submits a final report, confirming that the business has been closed and all outstanding debts have been paid.
- Cancel Trade License: The DED will cancel the trade license and remove the company from the registry, marking the end of the process.
Liquidation of a Free Zone Company
Free zone companies follow a simpler process, but each zone has its own rules. Generally, you must:
- Notify the Free Zone Authority
- Submit a board resolution
- Cancel visas and settle fees
- Get clearances from relevant departments
- Submit a final report or audit
- Cancel the trade license officially
Zones such as DMCC, JAFZA, AFZA and RAKEZ may require specific documents, so always verify with the relevant authority.
Documents Required for Liquidation
To complete the liquidation process, you’ll need to prepare:
- Board resolution confirming liquidation
- Original trade license and MOA
- Passport and Emirates ID copies of owners
- Power of Attorney (if applicable)
- Final audit or liquidator’s report
- Bank closure letters
- Clearance letters from government departments
Having complete documents helps avoid delays.
How Long Does the Process Take?
The liquidation timeline depends on the type of company and how quickly clearances are received. On average, the process takes between 30 to 90 days. Delays can happen if fines are pending, bank accounts are not closed, or government approvals take time.
Cost of Company Liquidation in UAE
Costs vary depending on the company type, size, and location. You can expect to pay for:
- Newspaper ads (AED 1,000–2,000)
- Liquidator fees (AED 3,000+)
- Government charges (AED 2,000–5,000)
- Visa cancellations and labour clearance
Typical total costs start at AED 7,000 and may increase for complex or large businesses.
How Silver Oak Documents Clearing Services LLC Can Help
Silver Oak offers full support for company liquidation in the UAE. Our experts manage paperwork, coordinate with government departments, and make sure your business is closed smoothly and legally. From cancelling your trade license to clearing staff visas, we handle every step to save you time and avoid stress.
