No matter what kind of business you operate in the UAE, you are required to revoke your business license and any relevant permissions as soon as you decide to shut it down. The procedures for properly ending your business and Trade License Cancellation in DMCC are summarized in this article.
DMCC Company Termination
When a firm or business is no longer able to operate, it must wind down operations through a process called company liquidation. This is sometimes referred to as DMCC license cancellation and termination. In each zone, there are distinct procedures and standards for liquidation. DMCC has different liquidation procedures and rules than any other zone. The process of dissolving a business involves a lot of paperwork and legal labor. A DMCC liquidator makes complicated work simple and aids the business in the liquidation process. The company is helped to wind up in line with UAE company legislation by the DMCC approved liquidator. The court or the parties involved may appoint a liquidator.
Importance and Role of DMCC Licenses
One of the most powerful licenses in the UAE is a DMCC license, which is well-known by numerous authorities, including banks, government regulatory bodies, law enforcement agencies, and others. Once it has been issued in the UAE, it is straightforward for you to continue with your regular company operations.
The Jumeirah Lakes Towers-based DMCC (Dubai Multi Commodities Center), which was built for commerce, contains everything you need to launch, develop, and expand your business. Three times named in the Financial Times magazine’s “Global Free Zone of the Year,” DMCC is home to a thriving community, cutting-edge infrastructure, first-rate services, and a desirable selection of properties, all just minutes from first-rate air, sea, and road connections to the rest of the globe.
Why Is It Necessary to Cancel the License Upon Business Closure?
To avoid any accrued fines and penalties inflicted upon your license, when it is not renewed at the time of expiration, pertinent governmental organizations must be aware that you are no longer operating the business, and the wind up of DMCC company becomes crucial.
In a shareholding business, it is critical to release your obligations to partners and creditors while safeguarding your shares and interests. If you decide to start a new firm, it’s a good idea to keep in mind your goodwill and professional reputation.
Forms to Complete for Company Termination in DMCC.
Depending on how your firm is set up, the license may be revoked. The process is straightforward for businesses and sole proprietorships because all that is required is to submit an application for cancellation through DED and obtain the necessary certifications from the following:
- Residency and Foreigners Affairs Directorate,
- the relevant water and electricity authority, the leasing entity, etc.
- Ministry of Human Resources and Emiratization
For companies with shares, the process takes longer since, before finalizing with DED, the shares must be liquidated, debts must be gathered, and creditors must be paid.
Procedure to Close a Company in DMCC
1. The DMCC website lists three different types of closures for company liquidation in DMCC as follows:
- Summary winding up is an option when a company has no debts or can pay off all of its debts within six months. It starts with a statement of solvency.
- The corporation can wind up its creditors by adopting a resolution to do so, which is followed by a meeting of the creditors.
- By UAE Commercial Transactions Law No. 18 of 1993, the court may declare bankruptcy.
2. More than just stopping operations is involved in DMCC company liquidation. Applying to close a business in DMCC / DMCC liquidation requires using the member portal. As a result of submitting the company termination application, the Directors’ powers, obligations, and liabilities will be ended. The application will be looked at and dealt with. A notice will then appear in the neighborhood Arabic newspaper. The DMCC authorities will then document the company’s formal termination and issue letters of termination for trade license cancellation.
3. You must always revoke the workers’ work authorizations and visas. According to Dubai Portal, this calls for collaboration with both the Ministry of Human Resources and Emiratization and the Department of Naturalization and Residency.
4. Employers are required to provide their employees a two-month, paid notice period before terminating their contracts under the UAE’s Labour Law. In many circumstances, workers are permitted to preserve their residency permits until the expiration of the business’s trade license. The corporation must then terminate its telecommunications and utility services. Obtain a NOC from the entity delivering the utilities to process the closure.
5. Also, liquidation services in DMCC help to prepare liquidator reports, audit reports, and statements of affairs.
Choose the Best Trade License Cancellation Services
The process of liquidation can be easily completed in the DMCC with the assistance of a DMCC approved liquidator. Our experts are available at hand to provide the best liquidation services and complete guidance during the process.