Closing a business in the UAE Free Zones is not as simple as letting your license expire. Whenever you think of it, first question that comes in mind is, How to close a free zone company in Dubai ? Actually it involves a structured process that all legal, financial, and regulatory obligations are fulfilled. Whether your company is registered in DMCC (Dubai Multi Commodities Centre), JAFZA (Jebel Ali Free Zone), or DAFZA (Dubai Airport Free Zone), each authority has its specific procedures. However, the core process remains similar, with required clearances, documentation, and regulatory approvals.
Why Proper Company Closure Is Important
Proper company liquidation that:
You are legally released from future liabilities
- .No fines or penalties are imposed for non-compliance
- Your corporate name is removed from the Free Zone and UAE registries
- .You can exit the market cleanly or plan a future re-entry
Types of Company Closure in Free Zones
Step by Step Process to Close a Free Zone Company
Closing a Company in DMCC
Dubai Multi Commodities Centre (DMCC) is one of the most regulated Free Zones. Here’s the closure process:
Steps:
- Board Resolution: Pass a resolution to dissolve the company and appoint a liquidator.
- Appoint a Registered Liquidator: DMCC requires you to appoint a licensed liquidator in the UAE.
- Apply for License Termination through the DMCC Portal.
- Notify Stakeholders: DMCC requires a notice period where the liquidation is advertised (usually 14–45 days).
- Settle All Liabilities: Clear all dues, salaries, and third-party obligations.
- Cancel Visas and Bank Accounts: Cancel all employee and investor visas and submit closure letters from banks.
- Get Clearance Certificates:
- DMCC Portal Clearance
VAT Deregistration from FTA (if applicable)
Customs (if applicable) - Submit Liquidator’s Report
Final Approval: DMCC will review documents and issue a company deregistration certificate. - Estimated Cost: AED 8,000 to AED 15,000+
Closing a Company in JAFZA
Closing a Company in DAFZA
- Board Resolution: Pass a board resolution for liquidation.
- Notarize the Resolution: Must be notarized and submitted to JAFZA.
- Appoint a Liquidator: Only registered liquidators are accepted.
- Employee Visa Cancellation: All active visas must be cancelled.
- Clear Utilities & Leases: Close DEWA accounts and release leased premises.
- Submit Final Audit Report and Liquidator’s Report.
- Publish Liquidation Notice in a local newspaper for 45 days.
- VAT Deregistration: If registered with the FTA, you must submit proof of VAT deregistration.
- Receive Final NOC & Deregistration Certificate
Timeline: 45–60 working days - Estimated Cost: AED 12,000 – AED 18,000+
Closing a Company in DAFZA
Dubai Airport Free Zone (DAFZA) provides a structured yet relatively quicker company closure process and guided about How to close a free zone company in Dubai ?
Steps:
- Apply for License Cancellation through the DAFZA portal.
- Submit Board Resolution signed by shareholders for closure.
- Cancel Visas & Immigration Cards.
- Liquidator Appointment & Report: Required if the company has existing obligations.
- VAT Deregistration (if applicable).
- Get Final NOC from DAFZA
- Deregister the Company Legally
- Timeline: 20–30 working days
- Estimated Cost: AED 7,000 – AED 12,000+
Documents Required Across All Free Zones
- While requirements vary slightly, here are common documents needed:
- Board Resolution to dissolve the company
- Liquidator appointment letter
- Trade license copy
- MOA & AOA
- Passport copies of shareholders
- Visa cancellation proof
- Bank account closure letter
- Final audit and liquidator’s report
- FTA VAT deregistration certificate (if applicable)
- Tenancy contract cancellation
FTA & Government Clearances Are Mandatory
Whether you’re in DMCC, JAFZA, or DAFZA, you must obtain the following:
- FTA VAT Deregistration (if VAT registered)
- MOHRE Labor Clearance (for mainland visa-issuing entities)
- GDRFA Clearance (if employees were sponsored)
- Immigration Card Cancellation
What Happens If You Don’t Officially Close the Company?
Letting your license expire without going through formal liquidation can result in:
- Monthly penalties from Free Zone authority
- Blocked immigration and labor services
- Overdue fines for VAT or other violations
Rejection of new company setups in the future
Tips for Smooth Company Closure
- Start the process 2 to3 months before license expiry
- Work with a licensed PRO or liquidation consultant
- Ensure all government dues are cleared
- Don’t forget to deregister with the FTA
- Communicate with employees and vendors transparently.
Frequently Asked Questions (FAQs)
No. Simply letting your license expire is not considered a legal closure and may result in fines, penalties, and future business restrictions. Formal liquidation or cancellation is required.
- DMCC: Approximately 30–45 working days
- JAFZA: Around 45–60 working days
- DAFZA: Typically 20–30 working days
Costs vary by Free Zone but generally range between AED 7,000 and AED 18,000 depending on the zone and complexity.
Most Free Zones, including DMCC and JAFZA, require appointment of a licensed liquidator, especially if the company has outstanding obligations. DAFZA also requires a liquidator if liabilities exist.
Yes. Cancelling all employee and investor visas and closing bank accounts is a mandatory part of the company closure process.
