Complete Guidelines on Company Liquidation in DMCC

Operating a business in Dubai Multi Commodities Centre (DMCC) comes with its challenges, and there may be instances where voluntary liquidation becomes a practical option. Voluntary company liquidation in DMCC allows business owners to exit their operations legally, ensuring a smooth transition that satisfies all stakeholders, including employees. However, navigating the complexities of the process requires careful planning to avoid last-minute challenges, as advised by experienced company liquidators in Dubai. In this blog, we will discuss guidelines on company liquidation in DMCC, providing a comprehensive overview for business owners considering the process.

Different Types of Company Liquidation in DMCC

The company liquidation instructions in DMCC provide detailed regulations for the liquidation. According to the company liquidation regulations in DMCC, the winding up of a company may appear in one of four different ways:

• Solvent Winding Up: Directors declare the capability to fully liquidate the company within 12 months.
• Involuntary Winding Up by the Competent Court: Initiated by the court due to serious violations or the company being struck off.
• Summary Winding Up: Directors declare the ability to liquidate the company fully within six months of initiating the process.
• Insolvent Voluntary Winding Up: Involves creditors' participation in the company liquidation process.

Company Liquidation Process in DMCC

Application Initiation:

• The Company chooses the service on DMCC's online portal.
• Select the amendment required (company liquidation) and the type of liquidation.
• Choose either Standard Resolution or Non-Standard Resolution.
• DMCC portal issues a notification of submission.

Assessment by DMCC Authorities:

• DMCC Authorities contacted the company to explore the possibility of retaining it.
• If retaining the company is not feasible, DMCC issues a notification to proceed with the liquidation.

Information Submission by the Company:

• The company provides details online, including information about the appointed liquidator (for companies only).
• Uploads necessary documents.
• Finalizes the application.
• Makes the required payment.

Application Review:

• DMCC authorities review the application, requesting additional documents if necessary.
• The company updates documents in the portal accordingly.

Application Outcome:

• If rejected, the DMCC returns the processing fee (except the non-refundable Knowledge and Innovation fee).
• If approved, the client receives notification to proceed with the liquidation.

Visa and Permit Cancellation:

• DMCC entity submits original documents to the DMCC Client Service Center.
• Applies for cancellation of work visas and permits.
• Initiates a 14-day publication process.

Final Report Submission:

• The company have to submit the final report of the completion of company liquidation in DMCC.

Closure and Confirmation:

• DMCC updates the company account, dissolves the company, and removes its branches from the registered list.
• Issues a termination letter and branch removal confirmation.

Situations in Which a Company Might Opt for Voluntary Dissolution

A company may voluntarily dissolve under the conditions outlined in its Articles if unanimously decided at a General Meeting, or if the company suffers a loss.

Considerations Before DMCC Company Liquidation

Appointment of the Liquidator:

• Reputable chartered accountants or auditors registered in DMCC, UAE, should be considered.
• Must be authorized and registered in DMCC, UAE.

Director's Obligations:

• The obligations and duties of the Director terminate upon filing the company's application for termination.

Service Limitations:

• Except for specific services directly linked to company liquidation, no services will be provided to a company in the process.

Commencement of Voluntary Winding-Up

A voluntary winding-up begins when the company passes a resolution for voluntary winding-up (for solvent or summary winding-up) or when the notification of the appointment of liquidators is certified (for insolvent winding-up).

Effects on the Company's Status

• If a company chooses to voluntarily wind up, it must cease business operations as soon as the process starts, with minimal exceptions.
• The company's position and authority remain until the dissolution, despite anything contrary to the Company's Articles.

Company Liquidation in DMCC

Reputable company liquidators in Dubai, like Reyson Badger, can assist in simplifying the DMCC liquidation process and let you close the company hassle-free. If you are considering voluntary liquidation in DMCC, strategic planning and adherence to the outlined guidelines can lead to a seamless and successful process.

Remember, a well-informed approach is key to navigating the intricacies of DMCC company liquidation and ensuring a favourable outcome for all stakeholders involved. For more information, don’t hesitate to get in touch with Reyson Badger.