An affiliated company consists of more than two shareholders, all of whom are jointly and severally liable for the debt burden of the company. If the company's operation fails and the company's property is insufficient to pay off the debts owed by the company, all shareholders of the company must bear the responsibility for paying off the debts owed by the company with all their property. In foreign countries, it is also called "joint company" and "joint company".
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The rise of affiliated companies is the product of China's economic system reform, which is mainly manifested in the development of enterprise groups. In the reorganization of state-owned property rights, the adjustment and optimization of industrial structure and product structure, it has a positive role in promoting the reform of state-owned enterprises.
However, due to some congenital deficiencies in standardization and the invisible influence of planned economy, the embryonic form of these subsidiaries-enterprise groups themselves have many problems.
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