How to Legally Close a Company in Dubai: Step-by-Step Guide

Closing a company in Dubai is not as simple as locking the doors and walking away. Whether your business is registered in the mainland, a free zone, or as an offshore entity, there are legal procedures you must follow to ensure proper company closure and avoid penalties. This process is known as company liquidation in Dubai, and it is regulated by the UAE authorities to protect creditors, employees, and business partners.

In this article, we’ll walk you through the step-by-step guide on how to legally close a company in Dubai, covering the documentation, approvals, and costs involved.

Why Do Businesses in Dubai Close Down?

There are several reasons entrepreneurs may decide to liquidate a company in Dubai:

Business is no longer profitable
Shift in investment strategy
Expiry of license and decision not to renew
Partnership disputes
Economic or personal reasons

No matter the reason, it is essential to close your company legally to avoid fines, immigration bans, or liability issues in the future.

Types of Company Liquidation in Dubai

Before starting, it’s important to understand the two main types of liquidation:

Voluntary Liquidation
- Initiated by the shareholders when the company is solvent but they decide to close it.
Compulsory Liquidation
- Ordered by a court, usually due to insolvency or inability to pay debts.

Most companies in Dubai go through voluntary liquidation, provided all debts and obligations are settled.

Step-by-Step Process to Close a Company in Dubai

The exact process varies depending on whether your business is registered in the Dubai Mainland, Free Zone, or Offshore jurisdiction. Below is a general step-by-step guide applicable to most companies:

1. Board Resolution

Shareholders must pass a resolution to close the company.
The resolution should be notarized and submitted to the relevant licensing authority (e.g., Dubai Department of Economy and Tourism (DET) for mainland companies or respective Free Zone Authority).

2. Appoint a Liquidator (for certain company types)

For LLCs and larger entities, a licensed liquidator in Dubai must be appointed.
The liquidator issues an official Liquidator’s Appointment Letter.

3. Cancel Employees’ Visas and Work Permits

All employees’ visas, Emirates IDs, and labor contracts must be canceled.
End-of-service benefits must be settled before proceeding.

4. Settle All Outstanding Liabilities

Pay off suppliers, creditors, and service providers.
Clear outstanding utility bills, office rent, Etisalat/DU accounts, and other commitments.

5. Obtain Clearance Certificates

The company must obtain No Objection Certificates (NOCs) and clearance letters from relevant authorities, which may include:

Ministry of Human Resources and Emiratisation (MOHRE)
Federal Tax Authority (FTA) for VAT deregistration
Dubai Electricity & Water Authority (DEWA)
Telecom providers (Etisalat/DU)
Landlord or property authority

6. Advertise the Company Liquidation (if required)

For LLCs, the liquidation notice must be published in a local Arabic newspaper for 45 days.
This allows creditors to raise any claims before the company is closed.

7. Submit Final Liquidation Report

The liquidator prepares and submits the final Liquidation Report to the relevant authority.

8. Cancellation of Trade License

Submit all documents to the Dubai licensing authority or Free Zone Authority.
Pay the required fees and obtain the Company Deregistration Certificate.

Documents Required for Company Closure in Dubai

The following documents are typically required (may vary by jurisdiction):

Shareholders’ resolution for company closure
Trade license copy
Memorandum of Association (MOA) copy
Passport copies of shareholders and directors
Emirates ID copies
Power of Attorney (if applicable)
Clearance certificates (DEWA, telecom, landlord, MOHRE, FTA, etc.)
Final audit report (if required)

Costs of Closing a Company in Dubai

The cost of liquidation depends on the type and size of the business. On average, company closure in Dubai costs between AED 8,000 to AED 15,000, excluding outstanding debts and employee settlements. Free zone companies may have slightly different fee structures depending on the authority.

How Long Does the Process Take?

Mainland company closure: 2 to 3 months (due to newspaper publication requirement).
Free zone company closure: 1 to 2 months (generally faster and simpler).
Offshore company closure: 2 to 4 weeks.

Why Hire a Corporate Lawyer for Company Closure in Dubai?

The liquidation process can be time-consuming and document-heavy. Hiring a professional corporate lawyer in Dubai ensures that:

All steps are carried out in compliance with UAE law
Employee and creditor rights are settled properly
No penalties or hidden liabilities remain
You receive your final deregistration certificate smoothly

At Falcon Law, our team of expert lawyers provides end-to-end company liquidation services in Dubai, handling all documentation, government approvals, and legal clearances on your behalf.

Final Thoughts

Closing a company in Dubai requires careful planning, multiple government approvals, and legal compliance. Whether you are shutting down a mainland, free zone, or offshore company, following the proper legal company liquidation process in Dubai will protect you from fines and future liabilities.

If you’re looking to legally close your company in Dubai, Falcon Law can assist you with every step — from employee settlements to obtaining your final deregistration certificate.

Contact Falcon Law today for a free consultation on company liquidation in Dubai.