Generally speaking, a subsidiary refers to a subsidiary established by the parent company according to law with all or part of its capital invested in other places. However, subsidiaries are legally independent from the parent company and have their own independent and complete corporate management organization system. The parent company can be said to be the largest shareholder of the subsidiary, and it can also be said to be an investor and manager.
In addition, because the parent company is the investor of the subsidiary, the business activities of the subsidiary must be controlled by the parent company, and the subsidiary must obey the needs of the overall strategy and interests of the parent company. But if the subsidiary is a joint-stock company, if someone holds more shares than the parent company, then the parent company will not work.
If it is a state-owned enterprise or a central enterprise, each level of subsidiaries corresponds to different levels. If the head office belongs to the ministerial level, then the first-level subsidiary belongs to the ministerial level, the second-level subsidiary belongs to the ministerial level, and the third-level subsidiary belongs to the ministerial level.