1. If the parent company guarantees the subsidiary, it is an external guarantee. The subsidiary and the parent company belong to two independent legal person organizations. A subsidiary has the status of an independent legal person and is regarded as an external guarantee. The company's external special guarantee refers to the guarantee provided by the company for shareholders with investment relationship or other entities with actual control.
2. Legal basis: Article 14 of the Company Law of People's Republic of China (PRC).
Companies can set up branches. The establishment of a branch company shall apply to the company registration authority for registration and obtain a business license. A branch company does not have legal person status, and its civil liability shall be borne by the company.
A company may set up subsidiaries, which have legal personality and independently bear civil liabilities according to law.
Article 16
Where a company invests in other enterprises or provides guarantees for others, it shall be decided by the board of directors or the shareholders' meeting in accordance with the articles of association; Where the articles of association stipulate limits on the total amount of investment or guarantee and the amount of individual investment or guarantee, it shall not exceed the prescribed limits.
Where a company provides a guarantee for the company's shareholders or actual controllers, it must be resolved by the shareholders' meeting or the shareholders' meeting.
Shareholders specified in the preceding paragraph or shareholders controlled by actual controllers specified in the preceding paragraph shall not participate in voting on matters specified in the preceding paragraph. The voting shall be passed by more than half of the voting rights held by other shareholders present at the meeting.
2. What are the legal risks of the company's external guarantee?
1. Asset status and credit risk of the guarantor. The company's external guarantee enables the company to accept the debtor when the guarantor is unable to pay off the debt. Therefore, when making a guarantee, it is necessary to evaluate the solvency and credit rating of the guarantor;
2. Risk at the decision-making level. The company's external guarantee will have a great impact on the interests of the company itself and shareholders. Therefore, when the company provides external guarantee, it must make a resolution through the company's board of directors or shareholders' meeting, so as not to damage the rights and interests of the company and shareholders.