Company Liquidation Process in Dubai, UAE
Company Liquidation Process in the Dubai, UAE involves various legal procedures and to complete the whole process, the appointment of a liquidator is mandatory. The liquidator can be an experienced individual or a specialized firm and they will be in charge of winding up the operations of an entity in an orderly and fair manner to benefit creditors.
The liquidator, who is considered as the legal representative for the entity, is usually appointed by the partners or the general assembly, or the court. There are certain rules and regulations to comply with before appointing a liquidator in UAE and giving them powers. Once the liquidator takes over the affairs of the business, the directors won’t have any power and therefore cannot act for or on behalf of the entity.
The roles and responsibilities of a liquidator
A liquidator must ensure,
- all the contracts related to the entity are completed or transferred
- the company’s businesses are ceased
- legal disputes, if any, are settled
- the selling of any assets
- the money that is payable to the firm are collected
- funds are distributed to creditors
- the share capital is repaid to shareholders
- the entity is dissolved and removed from the register
Following the appointment of a liquidator, they are required to register in the commercial register about the appointment. The registration will include the method and procedures that must be followed during the process of liquidation.
The partners and senior management of the company must provide the required documents, records and books regarding the accounts of the company and its assets and liabilities to the liquidator, to help them carry out stock trading of the assets and liabilities of the company.
The liquidator must prepare a comprehensive list that includes details such as the assets and liabilities of the company, the balance sheet, etc, which must be signed by the chairman of the board of director or the managers of the entity. The liquidator must take the necessary steps to collect debts from third parties and transfer the money received to the company undergoing liquidation. Also, it is the duty of the liquidator to fulfill all the functions related to liquidation, so as to represent the entity before the courts, settle its debts, and sell its moveable possessions or real estate by public auction or as given in the liquidation documents.
The liquidation of company in UAE is required to record all the transactions related to the activities they carry out in a book. This is usually done to ensure the liquidation duties were properly performed, without any violations.
The liquidator is entrusted with all the data related to the entity and it is their responsibility to execute tasks with utmost accuracy and preserve the assets and rights of the firm. Hence, it is extremely important to hire a trustworthy liquidator who can carry out the process of liquidation and can act in the best interest of the company. HLB HAMT can assist with the company liquidation process in Dubai, UAE, from the initial to the final stage.
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