Company Liquidation in UAE offshore
An offshore company is a business entity that is established in a low-tax or no-tax jurisdiction. Usually companies opt for offshore business setup for a variety of reasons that include legally minimizing the tax payment, improving the investor’s wealth management and to gain confidentiality over one’s financial affairs. HLB HAMT can assist companies with offshore company formation procedure in UAE and situations wherein the company finds it difficult to continue its operations and hence plans to liquidate, we help them with the liquidation procedure.
Liquidation of UAE Offshore Companies
There are three offshore jurisdictions in UAE, Ajman offshore, RAK offshore and JAFZA offshore and the procedure to liquidate is similar across these three. However, there might be slight variations in the regulations depending on the laws of the regulatory authority.
Liquidation in JAFZA offshore
- Cover Letter from Registered Agent for liquidation of the entity
- Request letter for closing the firm signed by Shareholder
- Shareholders Resolution for company liquidation and appointment of Auditor
- Original Certificate of Incorporation
- Original MOA/AOA (2 nos.)
- Original Shareholder’s resolution (if any)
- Auditor’s statement about the solvency of the subject company
- Original Bank Closure Letter
RAK offshore liquidation
A RAK offshore company may be liquidated provided it has no liabilities or if it is able to repay debts and the value of its assets is equal to or more than its liabilities.
Declaration of solvency
Prior to commencing the liquidation procedure, the directors of the company must;
- make a declaration of solvency mentioning that the entity has the capability to discharge, pay or provide for its debts and the value of the company’s assets equals or exceeds its liabilities.
- approve a liquidation plan stating;
- the reasons for the business liquidation.
- estimated time for liquidation.
- whether the liquidator has the right to continue the business of the firm if he decides that to do so would be mandatory or in the best interests of the creditors or members of the firm.
- the name and address of each individual to be appointed as liquidator and the fee that will be paid.
- whether the liquidator must send a statement of account to all members.
- that a notice of satisfaction or release has been filed and registered in respect to cases where there is a charge registered with regard to property of the entity.
Duration of liquidation
The liquidation of a company starts right from filing the notice of the voluntary liquidator’s appointment until its termination.
Notice and advertisement of liquidation
Within 2 weeks of appointment, the liquidator must file the below-given documents;
- an appointment notice
- the declaration of solvency made by the directors
- a copy of the liquidation plan
Liquidating a company in UAE offshore is not an easy process, but the assistance of a business consultancy firm can take you through the process smoothly. HLB HAMT has an experienced team who has involved in various types of liquidation and can help companies across Ajman offshore, RAK offshore and JAFZA offshore liquidate, without any risks.
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