A wholly-owned subsidiary refers to a company with only one corporate shareholders, which is wholly owned or controlled by the only parent company, and the shares of the parent company account for 100% of the subsidiary. Legally, a subsidiary is an independent legal person, engaged in business activities in its own name and independently bears civil liability. The subsidiary and the parent company shall bear their respective responsibilities to the extent of their own property and shall not be related to each other. However, if the parent company guarantees the wholly-owned subsidiary, it will bear corresponding responsibilities.
Legal objectivity:
Article 14 of the Company Law stipulates that a company may set up subsidiaries, which have legal personality and independently bear civil liabilities according to law.