Anti-crisis management to the rescue

Finding your way out of a crisis situation requires critical business decisions that can make the
difference between survival and collapse. Engaging expert advice is a vital first step. SORP Group
crisis management tools and techniques make recovery as efficient and easy as possible.
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There are certain strategies that work for any given scenario provided you select the right combinations and approach. SORP consultants will work with you to achieve successful outcomes based on their their proven track record and years of anti-crisis experience across many sectors and cases. We will advise you what the right decisions are in any situation and select the best way to recover your business in line with UAE legislation.

Reasons why business in the UAE can become unprofitable

Wrong choice of license and place of
incorporation

As a result, it does not fall into the intended niche and
does not reach the target audience

No USP (unique selling
proposition)

The effect is that it loses the ability to remain competitive
in the market for its goods or services

Unfortunate external
circumstances

Perhaps the wrong development strategy was chosen or
the business environment was not properly understood
leading to financial loss

Risky financial strategy and
crippling debt

Over optimistic forecasting and/or under capitalization
can cause a business to falter leading to inability to pay
suppliers and other creditors

Why you shouldn't quit your business and run away from financial problems

The most important thing to remember for a business owner in a difficult situation is to resist the temptation to abandon everything and flee from the UAE.

That would be a big mistake that would have negative consequences over your whole life.

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The consequences of abandoning the business

International publicity due to automatic
information exchange

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First, this event will receive international publicity. As soon as you cease your business activities in the UAE, you lose your tax resident status.

That means all information about you and your company (including violations, promissory notes, unfulfilled contracts in the Emirates, etc.) gets into the international system of automatic information exchange. The information you would probably prefer to keep secret will go public.

The availability of such information in the international system will invariably have negative consequences for you personally and your business as a whole. Your reputation will suffer because of this indication of your unreliability and incompetence.

Unfulfilled obligations and debts will
negatively affect your credit rating

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Secondly, unsecured liabilities and debts will negatively affect your credit history, including that in other countries. Almost all well-developed countries use the international banking system for collecting information about business entities around the world.

This is a kind of international register where information is stored about all debts, fines, unfulfilled obligations, violations of labor standards by entrepreneurs and much more. Leaving a business with such "baggage" risks you being blacklisted not only in the UAE, but also in other developed countries, as well as in large international banking structures. Your chances of getting loans on favorable terms for the development of a new business will be significantly reduced.

You restrict your right to move freely
through and inside the United Arab
Emirates

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Third, you limit your right to move freely. The Emirates are the largest transport hub through which many routes pass.

Leaving unfulfilled obligations behind in the country means you will no longer be able to safely use the UAE as a transit hub. You will be immediately removed from the flight and taken into custody until you have resolved all your debt issues.

Possible negative interpretation of
income as fraudulent

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Fourth, fleeing may be interpreted as an act of fraud. A criminal case will be opened against you, which may lead to your inclusion on an international wanted persons list.

Legal ways to get out of a crisis situation

All the above arguments prove that despite the situation and circumstances, if you are on the verge of a crisis or are experiencing financial difficulties, you need to act in accordance with the letter of the law.

Together with SORP consultants, you will be able to go through a financial recovery procedure in
order to find an opportunity to pay off debts and, depending on your goals, put your business in
order or properly wrap up all cases.

More about ways to get out of a crisis situation

Bankruptcy

If you believe that the financial situation of your company has approached critical levels, you urgently need to go to court and initiate a financial recovery procedure before your creditors have the right to start a criminal case against you.

Having considered your application, the court will appoint an expert (trustee) who will conduct a financial audit, establish the amount of your debt to creditors and help you draw up a debt repayment schedule. This document is registered in court and presented to creditors who are forced to agree to these measures, since it is their best interests for you to pay them. The Committee for Financial Restructuring supervises the actions of the management of the debtor company in this situation.
Pre-trial
settlement
Drafting employment contracts,
service and investment agreements
Outsourcing
services
Accounting, tax, consulting and legal
support
PRO
business support
Immigration procedures and
registration of employees in the
Ministry of Labor

Liquidate a legal entity and revoke a license

If the business is failing, you no longer want to do business in the UAE, or you believe that you were mistaken with the choice of jurisdiction or type of license, you must put an end to it quickly.

In this situation, you need to fulfill all your financial obligations to counterparties, pay off the staff, de-register the company, revoke the license and close bank accounts. This procedure will take a little time because debts need to be cleared.

If you are not going to leave the UAE and intend to resume work, this time choosing the right place and obtaining permission for suitable types of activities, then you will have to go through the incorporation procedure again.
Tax deregistration
support
Drafting employment contracts,
service and investment agreements
License revocation
support
Assistance in passing de-registration
procedures in authorities
Bank account closure
support
Communication with banks on
behalf of the company

Sell the business

In the UAE, there is always great demand for a working business. This is due to the high level of business activity in the country and a constant influx of new investors. The most valued companies have these characteristics: an active customer base, a workforce in place, financial audit available, development plan drawn up, business has been successfully operating in the UAE for some time.

If you do not want to develop the business then transferring it to a new owner is a rational, quick and legal way to get out of it while receiving financial compensation for the effort invested. SORP specialists provide a full cycle of services for buying and selling existing companies.
Comprehensive business
audit and valuation
We will carry out an audit and
detailed examination of all financial
indicators and management
Marketing strategy
development
Assessment of competitiveness, as
well as actual value, identification of
advantages and trends
Business re-registration
support
Legal support in re-registration of a
business and ensuring complete
security of the transaction

Freeze the license for a certain period

Doing business in the UAE requires certain outlays. For example, license renewals, office rent, legal and accounting services. There are situations when, despite the fact that your business is in the right place and has the right licenses, it is not earning the desired profit and it becomes expensive to recoup the costs.

Such circumstances force you to think about suspending activities. In such a situation, SORP consultants recommend using the license freeze service. This step will save you from having to go through the difficult path of liquidation and starting all over again. You will retain the legal entity and license for up to three years.
License freezing support
Communicate with government
bodies on behalf of the company
Legal and PRO service
Draft employment contracts, service
and investment agreements
Post-crisis development
strategy
Design an individual anti-crisis
model to suit the business environment

Anti-crisis management, financial restructuring and cost optimization

Control, audit and risk management are the keys to successful business. If you believe that operating expenses are too high, take measures to rationalize costs.

In order to effectively assess and identify the "problem" areas of your activity, it may be necessary to analyze the effectiveness of personnel and develop a methodology for increasing labor productivity. If necessary, it is important to optimize the number and structure of the workforce and retrain key employees. It is also necessary to prepare management reports that can objectively reflect the state of affairs in the company.
Reporting
Prepare management reports that
objectively reflect the state of affairs
Owner risk assessment
Control of, and prompt response to,
internal and external risks
Crisis management
SORP Group provides professional
management services for businesses

SORP Group will become your reliable long-term
partner in the UAE

Leading consulting group providing a full range of services for the incorporation, support and management of business in the UAE
and abroad. We have an impeccable reputation, wide-ranging capabilities and a solid asset base.

Comprehensive services

SORP offers comprehensive support for acquired companies and their shareholders: from licensing, maintaining Bank accounts to obtaining the status of a tax resident of the country

Individual approach

Your requirements are unique. That is why we treat every business individually to tailor the right services to achieve your priorities.

15 years of successful work

We have helped thousands of clients acquire, build and develop businesses in the UAE

Banking support

Assistance in choosing a bank that is suitable for your purposes, support with bank accounts opening and passing KYC procedures (know your customer).

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