Q: One of the directors with a 16% share doesn't want to close the company. The Emirati with 51% and 2 other directors with 17% & 16% want to close the LLC. The license has expired 15 days ago. What to do now?

Q: Dear Sir, We would like to wind up our business. It is an LLC company based in Sharjah, UAE. One of our partners is missing and we are unable to trace out her. There are 3 partners excluding the UAE national sponsor. Me, my wife & one more lady. She was always a sleeping partner as I am the managing director & authorized signatory. Now since we are unable to run the business profitably, we would like to close down the business. The trade license expires in May 2020 and we don’t want to renew it anymore. We have no financial obligations to anyone at the moment. We have given 30 days notice to our employees. Kindly advise us to proceed further!

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: I had a professional service company in a partnership licensed by DED, Dubai. There were some issues and we decided to sell the license. The sale was completed with the sale deed registered in a Dubai court in Feb 2020. However, the new owner failed to renew the license and update the records with DED, Dubai. Therefore, I am still registered as the owner and manager of the license with the DED. In this scenario, who is the legal owner now, and what are my options to remove my name from the license or to close it?

Q: How can I remove my shareholder name from a professional license in Dubai economy? And how can I cancel my partner visa from this license? Kindly help me!

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.

It is the first article in a series of articles written by the author to give a better insight to the readers about the corporate governance practices under the best practice principles and the UAE legal system through innovative suggestions of its implementation for your organisation. Next series will be on the UAE regulatory framework on corporate governance.

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.