I am unable to return to the UAE. How can I close my business?

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Dubai: Stuck outside the UAE and want to shut down your business? As the COVID-19 pandemic makes people’s work and personal life take unpredictable turns, a Gulf News reader wrote in, asking what he could do to liquidate his business, as he was struggling to return to the country.

He said: “I am have to close down my business in the UAE. I am stuck in India at the moment, and I don’t think I will be able to come to the UAE anytime soon, as I am also facing some personal emergencies with my family. I spoke to my lawyer and wanted to give him the power of attorney to complete the process from my end. But I have heard that this would take a long time. Considering the situation I am in, I don’t want to run up any losses, so what is the easiest and quickest way to close my business? Please help.”

Gulf News spoke with business setup consultants in the UAE, who said that during COVID-19, government departments had made it easier for business owners to set up and liquidate business by shifting many of the procedures online.

Cancelling the licence of a mainland company

Cancelling the licence of a mainland company depends on the business licence of your company. For establishments and sole proprietorships, the process is simple because all you need to do is to apply for cancellation through the economic department in your emirate and acquire all relevant clearances from:

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• Ministry of Human Resources and Emiratisation (MOHRE)

• Directorate of Residency and Foreigners Affairs

• The relevant water and electricity authority

However, for companies with shares, the process is longer because it requires liquidating the shares, collecting the debts and paying the creditors before finalising with the economic department.

Almost all procedures can be completed online

If you are a limited liability company (LLC) based in Abu Dhabi, the liquidation process can be completed online. Even if you are a business owner who is unable to be present in the UAE, you can complete the liquidation procedure as long as you have a power of attorney stating that you can liquidate the company

– Jade Wong, business consultant with PRO Partner Group

As many government departments and notaries have adopted smart service systems, many of the company liquidation procedures can be completed online.

In fact, according to Jade Wong, a business consultant with PRO Partner Group, public and private notaries are now allowing the notarisation process to be completed online, whether you wish to set up a company or liquidate one.

“If you are a limited liability company (LLC) based in Abu Dhabi, the liquidation process can be completed online. Even if you are a business owner who is unable to be present in the UAE, you can complete the liquidation procedure as long as you have a power of attorney stating that you can liquidate the company,” Wong told Gulf News.

Dubai-based public relations officer Sirajudeen Ummer also said that notaries in Dubai are conducting proceedings through video conferencing.

“For all the notary services, a person does not need to be physically present as the service is done through BOTIM,” Ummer, who works with Dubai-based First Gate Business Services, said.

However, he added that as some of the other steps may be completed more quickly if a representative is present in the UAE, it would be advisable to consider providing a power of attorney to a lawyer, partner or trusted contact, who can complete the proceedings on the business owner’s behalf.

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The closing down of the business should be advertised in two Arabic newspapers, with a 45-day notice.

– Sirajudeen Ummer, Public Relations Officer at Dubai-based First Gate Business Services

Step 1: Issue a power of attorney

As mentioned earlier, even if you have an Abu Dhabi-based LLC and you can complete the procedure online, you would need to have a power of attorney stating that you are in a position to liquidate the company. So, the first step would be to issue a power of attorney, whether to your lawyer who is based in the UAE, or to yourself, noting that you are in a position to liquidate the company.

“If the business owner issues a power of attorney to a lawyer, it is possible for the lawyer to complete the procedure. If not, they would need to come to the UAE,” Sirajudeen Ummer, Public Relations Officer at Dubai-based First Gate Business Services, told Gulf News.

Who should I approach?

Each emirate has a department for economic development (DED) which issues these licences. These are the authorities for each emirate.
Abu Dhabi Department of Economic Development – https://added.gov.ae/
Dubai Department for Economic Development – https://dubaided.gov.ae/
Sharjah Department for Economic Development – https://www.sedd.ae/web/sedd/home
Ajman Department for economic development – https://www.ajmanded.ae/#openModal
Fujairah Department for Economic Development – https://fujairah.ae/ar/Pages/default.aspx
Ras Al Khaimah Department for Economic Development – http://www.ded.rak.ae/
Umm Al Quwain Department of Economic Development – http://ded.uaq.ae/en/home.html

Step 2: Cancel the work permits of all existing employees, if any.

Once you have cancelled all the work permits with the Ministry of Human Resources and Emiratisation (MOHRE), you would then need to take a document from the immigration department and MOHRE, stating that there are no employees in the company and there are no partner visas.

Step 3: Cancel Labour Establishment card

Then you would need to visit a Tas’heel centre to cancel the Labour Establishment card (Cost: Dh83), and the immigration establishment card (Cost: Dh500)

You would need to submit the seal and authorised signature of the company on the application as well. You will then get the Labour Establishment Cancellation receipt from the Tas’heel Centre.

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Step 4: Cancel the Memorandum of Association (MOA)

An MOA is signed during the formation of a company, which would need to be cancelled. This can be done at a notary and all the partners and POA holders need to be present.

Step 5: Cancel DED licence

You would then need to get the ‘DED licence cancellation form’ typed out from the typing centre, get the signature of the partner/sponsor and go to the DED counter at Tas’heel Centre for Licence cancellation. The Partner/PRO/Sponsor is required for submission.

If you do not have a Labour Establishment Card for your licence, follow this procedure:

• Go to the Typing Centre adjacent to Ministry of Human Resources and Emiratisation (MOHRE) in Al Qusais and get a letter typed in Arabic stating that this licence does not have an Establishment Card.

• Take this letter to MOHRE Customer Care counter and get it sealed.

• Now get the DED licence cancellation form prepared from the typing centre, get the signature of partner/sponsor and go to the DED counter at Tas’heel Centre for Licence cancellation.

Licence Cancellation Fee:

• Dh105 Service Charge for Tas’heel/DED Service Centre

• Dh21 Afaq Commission for Aafaq Payment counter (including VAT). This is a service charge for processing the payment.

Step 6: Get Auditing report and publish newspaper advertisement

You would then need to apply for an auditing report from a licensed auditor, for which you would need to approach an auditing firm.

“The closing down of the business should be advertised in two Arabic newspapers, with a 45-day notice,” Ummer told Gulf News.

Step 7: Get the trade license cancellation certificate

You would then need to sign the minutes of an inventory of assets provided by the auditor and submit it to the DED, after which the DED will issue a payment voucher. Once the payment is complete, a DED trade licence cancellation certificate will be issued.



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