In fact, the parent company usually does not need to bear the debts of its subsidiaries.
Legally speaking, there is still no legal basis for sub-creditors. Like the parent company, subsidiaries have independent legal personality and are independent individuals, and both of them bear property liabilities within the limits of their own property.
When there is a legal dispute in the operation of a subsidiary, the parent company usually does not have to bear any responsibility. Similarly, the debt disputes of the parent company do not need to be borne by the subsidiary.
A subsidiary refers to a company in which a certain number of shares are controlled by another company, or actually controlled by another company according to an agreement. Subsidiaries have independent legal personality, own all their own property, own their own company name, articles of association and board of directors, conduct business activities in their own name, engage in various civil activities, and independently bear all consequences and responsibilities brought about by the company's actions, but major decisions or major personnel arrangements involving the company's interests are still decided by the parent company.
Usually, the parent company and subsidiary company are legally independent legal entities established according to the principle of limited liability, and they do not bear legal responsibility for each other. But economically, they are inextricably linked. The parent company controls and manages its subsidiaries in terms of capital, technology, brand, senior management and development strategy. However, in case of debt relationship, according to the principle of limited liability of legal person, each subsidiary can only bear the debt liability independently, and the parent company does not bear the responsibility. In this way, the subsidiary went bankrupt. In the case that there are few bankrupt properties and the creditors of subsidiaries are basically unable to repay, whether to claim the creditor's rights from the property of the parent company has become a very complicated and thorny legal issue.
Referring to laws and regulations, we can see the second paragraph of Article 14 of the Provisions on Strengthening the Financial Management of Parent Companies to Subsidiaries: "Subsidiaries enjoy property control and operational autonomy, operate independently according to law, and be responsible for their own profits and losses", and the second paragraph of Article 14 of the Company Law: "A company can set up subsidiaries, which have legal personality and independently bear civil liabilities according to law".