Q: One partner wants to leave the company. What are the options if the other partners are not willing to let him go? It's a tech company and the partner in question is the CTO, without him, the company will almost certainly fail. There are accumulated operational losses to the tune of AED 4 million. It's a Dubai Mainland LLC. The second partner is a Dubai company who acts as a collaborator in some of our projects. We recently found out that the GM and a couple of top managers in that company are building a clone of our most promising product. We can prove it too. Both the teams happened to bid for the same opportunity and the customer realized both are exactly the same product and informed us. Is this enough legal grounds to demand release from the partnership?

Q: Hi. Kindly advise regarding: (1) Closing a professional civil company (management consultancy) in Dubai with 4 partners + 1 local agent. There are 4 partners (all family members) who are out of the UAE. 2 partners have investor visas & 2 have partner visas. 3 visas have expired during July-Sept 18 and 1 Investor visa expiring 17/11 as being out of the country for 6 months+. Online at www.gdrfa.ae on logging in, the 3 expired visas are showing 'Inactive'. Does it mean visas are automatically cancelled & they can come on visit OR visas have to be physically cancelled at the immigration dept? The company has no assets/liability. We want to close the company. The company's labour est card is already cancelled. (2) Effect of a partner's personal credit cards' liability on the company as a he is a partner. In the above company, 2 partners have credit card dues. Is there an impact on 2 aged partners coming back to the UAE if the banks file cases & secure order on attaching the defaulting partners share in above company? (There is no business/assets). Can the 2 partners be harassed in UAE?

Q: Hi. Kindly advise regarding: (1) Closing a professional civil company (management consultancy) in Dubai with 4 partners + 1 local agent. There are 4 partners (all family members) who are out of the UAE. 2 partners have investor visas & 2 have partner visas. 3 visas have expired during July-Sept 18 and 1 Investor visa expiring 17/11 as being out of the country for 6 months+. Online at www.gdrfa.ae on logging in, the 3 expired visas are showing 'Inactive'. Does it mean visas are automatically cancelled & they can come on visit OR visas have to be physically cancelled at the immigration dept? The company has no assets/liability. We want to close the company. The company's labour est card is already cancelled. (2) Effect of a partner's personal credit cards' liability on the company as a he is a partner. In the above company, 2 partners have credit card dues. Is there an impact on 2 aged partners coming back to the UAE if the banks file cases & secure order on attaching the defaulting partners share in above company? (There is no business/assets). Can 2 aged partners be asked to submit the company a/cs?

Q: What is the process to close an LLC company which makes losses? I am a partner. My partner/ managing director didn't make any audit nor accounting for 5 years. I filed a case against him. He mismanaged the company and it went into losing more than the capital, 200% of the capital and he didn't inform me. What should I do?

Q: I have an LLC technical company made in November 2017 and sold 50% share to one of my employees in 2019. I gave him all signature authority to handle our company and his salary will be paid as an employee. Later on, in September 2020 he made his own LLC technical license without informing me with a similar name and business to my company and used all resources asset of our common company without my knowledge and permission for his personal company and personal benefit. He is still my employee and getting paid his salary as well as a partner also and he is doing all work with our common resources for his personal company use and taking our clients due to the similar name of his own business. I want to know if any Legal action is possible for his misuse of common resources and obtaining a license without any NOC. Please advise. Your early response will be highly appreciated.

س: السلام عليكم، لدي تعامل تجاري مع شركة الشكل القانوني لها شركة توصية ولدي منها شيكات. الشركة حاليًا مغلقة ورخصتها منتهية ولكن الشريك المخوَّل والموقِّع على الشيكات لا يزال موجودًا ولديه أعمال غير مرتبطة بالشركة. هل يمكن مطالبته بشكل شخصي أم أن المطالبة خاصة بالشركة كون الشيكات صادرة من شركة التوصية والتي كان شريكًا بها؟

The UAE continues to strive to modernize its laws and create more flexibility in meeting the needs and requirements of investors and businessmen and elevate its economy to the highest levels of growth and development.

Companies can be wound up by Voluntary Liquidation. This shall proceed as initiated by shareholders or creditors of a company by passing a valid shareholder’s resolution. When a company’s financial mechanism fails, and the company is in financial distress and/ or becomes insolvent whereby it is unable to pay off its debts, the company may file a petition for winding up to the court.

The provisions of this Law apply to the commercial companies established in the UAE and the foreign companies that have established in the UAE a base to conduct any activity therein or established a branch or representative office. The Law abrogates Federal Law No. (8) of 1984 Concerning Commercial Companies.