Dubai Silicon Oasis Authority is a major free zone in Dubai which is under 100% Government ownership. It promotes industries that predominantly make use of contemporary technology, offering an impeccably master-planned urban community, in-house business solutions and top-notch infrastructure. Liquidation is a procedure where the business establishment/entity has to be dissolved and its life comes to an end. It should be noted that a company will have no obligations/debt towards any private firm or Government. Company assets will be easily transferred to shareholders wherein companies will be appointing liquidators for executing the procedure.
Some reasons for company liquidation include maximum borrowings, cash flow issues, loss of major deals/contracts, creditors issuing petitions (wind-up), late payments made to debtors and continuous decline in profits. There are various kinds of liquidation for companies as well. These include the following:
- Voluntary Liquidation- The directors/owners of the company will themselves initiate the process of liquidation if they fail to pay creditors in a timely manner.
- Compulsory Liquidation- Creditors mainly force this decision here and this is executed mostly post wind-up petition approval in courts.
Steps for liquidating companies in Dubai Silicon Oasis
Here are the major steps that have to be followed for liquidating companies in Dubai Silicon Oasis:
- Companies should submit their notices to the Dubai Silicon Oasis free zone authority stating the reasons behind the closure and this should be done at least 3 months before liquidation. There will otherwise be charges applicable for cancellation of lease agreements.
- A shareholder’s resolution/board resolution will have to be attested in front of the free zone executives for de-registration purposes. If shareholders are from outside UAE or the owner of the company is a foreign entity, then resolution should be notarized and then attested by the UAE Embassy of that particular country. This should then be legalized by the Ministry of Foreign Affairs in the UAE.
- Companies should return all transponders and office keys (not applicable for freehold/leasehold companies).
- Company post box should be closed and keys should be returned.
- Company certificate of formation, original license, share certificates, lease agreement and original license from the Department of Economic Development should be furnished.
- Clearances such as DEWA clearance (applicable for facility in Light Industrial Unit, Techno Point, Land Lease, High Bay, Leasehold and Freehold categories), Dubai Customs Department clearance, DSOA Government Services Department clearance, DSOA Finance Department clearance and DSOA IT Section clearance are required. Etisalat clearance and facilities management clearance are aso needed.
- A Dubai auditor is required to prepare the report for liquidation.